- Modern societies: intellectual property laws
LAW AND TECHONOLOGY
The Law cant keep up with Technology and thats a very
good thing
Kevin Maney
- Explosions of number of cars in the US in the 1920s
- Slow response from US lawmakers but technological advances are
getting faster
- Since they could not regulate their number anymore, they had to
accommodate them
- Fantasy sports
o shows how fast technology can exploit this gap between Law
& tech
o gap in anti-gambling laws in games of skill
o officials are already too late- its not anymore a question if
they fit into old laws, but how theyre willing to destroy
million dollar companies owned by important investors
o speed to critical mass strategy to avoid government
intervention
- drone aircrafts v federal aviation administration
- bitcoin could remake global financial system
- Uber, Airbnb
- There are dangers in this gap:
o public policy crisis for the new economy
Startups often find themselves in fight against legacy
businesses which are protected by regulations and laws
o Risk to society of ungoverned technology
- Call for laws that could protect us from technology
Law and Technology: Interactions and Relationships
Daniel Gifford
- TECHNOLOGY: application of labor to create a product, generate
services, or produce desired result
- LAW: set of rules adopted by societys governing institutions
applicable to all inhabitants.
- Law and Technology interact
o when rules FOSTER or RETARD devt of technology
o when society decides that technology produces undesirable
results and employs rules to contain/ modify results.
I. Background
- Property rights generate incentives to productive behavior
- Traditional property does not include intellectual property, society
had expanded regime to include these
A. Law, Property rights, Incentives and Trade
Property rights
- law creates CONDITIONS crucial for devt of technology
- w/o prop rights no incentives for productivity
- New dimension when one talks about transferability
o Incentives increase
o ^ to create for others and for additional compensation
B. Intellectual Property and its Incentives
- Traditional prop rights fail to incentivize creative activities
- New ideas can be replicated by others
o patent system- exclusive rights in invention for 20 years
o intellectual commons to regime that provides incentives for
creativity
II. Competition, Monopoly, Technology and the Generation of
Wealth
- Free and open market maximize productive incentives
- Competition among sellers maximizes social wealth
- Competition pressures producers to employ most cost-effective
techniques by replacing less efficient producers with more efficient
producers
- Monopolies produces opposite effect
o Restrict production to maintain higher prices
o Deny society uses which are of less value than monopoly price
but higher than cost of production -> social loss
o Allocative inefficiency
o Less productive efficiency
- Competitive markets v exclusive rights over technological
developments
o May amount to economic monopoly
o Both competition and intellectual property laws are designed
to foster economic welfare
o Exclusive rights -> new technology -> societal welfare
- Intellectual property laws
o Costs:
Restrict use of new technology (social waste)
III. The Scope of Intellectual Property Protection
- Law defines scope and term of intellectual property rights
- Antitrust v intellectual property
- Courts presumed that a patent created market power, and from
that presumption created a virtually per se rule against tying
arrangements involving patents.
- It was not until 2006 that US SC said that a patent would not be
presumed to generate market power for purposes of applying
antitrust laws to tying arrangements
- Patents
o Protect only to advances beyond capability of normal
practitioner
o Protects only what inventor claims
Doctrine of equivalents: extend protection to variations
But is the stringent description requirement destroy
incentive to invent?
o Lemley and Burke: scope of patent and applicability of the bar
for lack of description should vary by field of invention
o Patents on minor inventions discourage inventors because
they raise costs because of the need to apply for multiple
licenses
IV. Negative Externalities
-e.g. pollution produced by factories > courts make them indemnify
those directly affected -> pass costs to customers who bear final costs -
> costs not internalized by companies
V. Positive Externalities
- Law plays a major role in engendering basic research where the
incentives are lacking
- Law can be effective in promoting economic objectives
- Patent system
o legal structure keyed to market
o Exclusive rights act as stimulus
o Market as ultimate determinant of reward
- Govt intervention to foster growth of particular sector is likely to - Prescriptive technologies have taken over and PLANNING has
fail because it requires govt to know more than the market become a major policy tool
o Planners develop plans
VI. International Trade and Technology o Plannees those who have to conform to them
- Continent-wide market of US - Two PLANNING STRATEGIES
- Enabled manufacturers to employ technology for scale economies o To maximize gain
- World has been gradually decreasing its tariffs o Minimize disaster
- Global competition -> advantage to labor-intensive industries -> - TWO COMPONENTS OF ENVIRONMENT
producers from developing nations o Built and constructed environment
- TRIPS agreement extended intellectual property protections -> o Nature
greater incentive -> more competitive global economies o NO to nature as infrastructure to be adjusted and used
- COMMON PATTERN OF NEW TECHNOLOGY
VII. Legal Failures and Market Failures o First stage of introduction
- Market failures result of failure of legal system to specify promise of liberation not subsequently fulfilled
property rights mechanism for dependency after acceptance
- E.g. pharmaceutical industry
o Incentives generate new drugs for relief of illnesses - social, economic, and human costs
o Companies are rewarded from sales at competitive prices o solution in stressing CONTEXT
o Negative effect: - crisis of technology crisis of governance
higher prices exceed reservation prices of potential - change must come from below
customers - earthworm theory
denial of life saving drugs to millions in under developed - need for reciprocity
world (because prices are keyed to developed world) - if somebody robs a store, its a crime and the state is all set and
international legal system impede effort to reduce price ready to nab the criminal. But if somebody steals from the
to underdeveloped world commons and from the future, its seen as entrepreneurial activity
potential of arbitrageurs and the state cheers and gives them tax concessions rather than
no incentives for cures for illnesses not found in arresting them. We badly need an expanded concept of justice and
developed worlds fairness that takes mortgaging the future into account.
- checklist to help in the discourse on public decision-making. Should
one not ask of any public project or loan whether it: (1) promotes
The Real World of Technology justice; (2) restores reciprocity; (3) confers divisible or indivisible
benefits; (4) favours people over machines; (5) whether its strategy
Ursula Franklin maximizes gain or minimizes disaster; (6) whether conservation is
favoured over waste; and (7), whether the reversible is favoured
- technology as practice over the irreversible
- links it to culture which is commonly shared values and PRACTICES - This new social contract needs to be one in which the consent to be
- way of doing: holistic and prescriptive governed, regulated, and taxed depends on a demonstrated
o holistic doer is in control stewardship for nature and people by those who govern.
o prescriptive-
work is divided into specified steps carried out by
separate individuals
division of labor
Crucial social invention practiced at the workplace
- Acculturation into culture of compliance built on adherence to
prescription make BUREACRACY possible
- Growth model v production model schemes that uie discourse
and decision-making
- Separation of knowledge from experience
o Rise of experts and decline of peoples trust in own
experiences
- Communications technologies and how they altered perceptions of
reality, created pseudorealities/ pseudocommunities
o RECIPROCITY modern tech makes this impossible
- Role of government in promotion and support of technology
o Publicly financed infrastructures and financial and tax
structures have emerged
Support systems for advancement of technology
- Divisible and indivisible benefits and costs
o Technological support structure has been accompanied by a
NEGLECT of the government of their traditional mandate to
protect the COMMONS as source of indivisible benefits
Publicly funded infrastructures have become roads to
DIVISIBLE benefits private and corporate profit
While those we hold in common- sources of indivisible
benefits are not safeguarded