Beyond Economic Analysis of Intellectual Property: The Need For Social and Cultural Theory (Madhavi Sunder)

Over the course of the last century intellectual property has grown exponentially, but its march into all corners of our lives and to the most destitute corners of the world has paradoxically exposed the fragility of its economic foundations while amplifying its social and cultural effects. Today intellectual property laws bear considerably upon central features of human flourishing, from the developing world’s access to food, textbooks, and essential medicines, to the ability of citizens everywhere to democratically participate in political and cultural discourse.

Despite these real world changes, intellectual property scholars insist on explaining this field through the narrow lens of a particular economic vision.Intellectual property is understood solely as a tool to solve an economic "public goods" problem: nonrivalrous and nonexcludable goods such as music and scientific knowledge will be too easy to copy and share—thus wiping out any incentive to create them in the first place—without a monopoly right in the creations for a limited period of time.

In a forthcoming book, iP: YouTube, MySpace, Our Culture, under contract with Yale University Press, I argue that an intellectual property law befitting our new participatory century must lift its gaze beyond the narrow goal of incentivizing the creation of more intellectual products to facilitating critical and autonomous participation in the cultural sphere. Modernity is not simply technology. A modern intellectual property law must promote our capacity to author our own lives. These are not too lofty concerns for intellectual property law. Recall that the first copyright statute in England, the Statute of Anne, subtitled "An Act for the Encouragement of Learning," had as its aim nothing less than the promotion of Enlightenment itself. Today, august bodies from the European Patent Office (EPO) to the World Intellectual Property Organization (WIPO) urge the need for a broader understanding of intellectual property law.

To be sure, "culture" is a word on everybody’s lips in intellectual property circles. James Boyle spurs a "cultural environmentalism" movement to counter the privatization of our intellectual heritage. Larry Lessig warns that legal code and computer code together are morphing our once "free culture" into a "permission culture." Yochai Benkler explores how commons-based methods of production "provide more opportunities for participating in the creation of culture." Jack Balkin says the First Amendment and intellectual property ought to be concerned about "cultural democracy." All of these scholars seek to protect our cultural commons and the processes of cultural innovation. Yet there is resistance in the intellectual property academy to the elaboration of a cultural theory of intellectual property that would stand beside and help illuminate the economic account.

My book takes up this task, and this week I have invited a handful of preeminent scholars to debate and discuss the call to move intellectual property scholarship beyond economics to include social and cultural theory. The discussants are Funmi Arewa (Northwestern law), Mario Biagioli (Harvard Department of the History of Science), Graeme Dinwoodie (Chicago-Kent law), Rochelle Dreyfuss (NYU law), and Robert Merges (UC Berkeley law). Our discussion is by no means closed; consistent with the spirit of the Faculty Blog and the subject of this very debate, others are welcome and encouraged to participate.

We will consider some of the following questions: Do we need to expand the theoretical framework for intellectual property beyond a narrow economic analysis? Why has there been resistance to social and cultural accounts of this law? Despite the resistance, are such approaches in fact emerging, and if so, why?

In this opening post I pose two specific critiques of the narrow economic approach to intellectual property. First, I argue that the approach is premised on an outmoded understanding of culture itself. Law’s goal is to promote the invention of more machines, from Blackberry to iPod, and more intellectual products, from Mickey Mouse to R2D2. But the object of intellectual property law’s desire—culture—is profoundly changing. Culture is no longer understood simply as incontestable tradition handed down by recognized cultural authorities, or as canned commodity. Increasingly, culture is participatory community. We are moving away from culture as Mickey Mouse to bespoke culture empowered by a computer mouse. The narrow economic account, focused on the production of more goods, does not ask who makes the goods, and whether there is equal capacity to participate in making our culture.

Second, the current approach pays insufficient attention to the interrelationship between culture and development. A 21st century theory of culture worth its salt cannot ignore the important issues of development and global justice. Culture plays a critical role in development, and in meeting the U.N. Millennium Development Goals, which include the eradication of extreme poverty, universal education, gender equality, child and maternal health, combating HIV/AIDS, and achieving environmental sustainability. Intellectual property laws bear profoundly on what Martha Nussbaum calls central human capabilities, from the capability to live "a human life of normal length," to "being able to use the senses, to imagine, think, and reason…in a ‘truly human’ way… cultivated by adequate education." Morever, cultural production is increasingly important to economic development in a Knowledge Age. That is, cultural democracy is not only an end, but also a means to promote economic development.

I offer one example to perhaps begin to focus our discussion and make it more concrete: the limits of current law in the context of user-created content. From YouTube videos to fan fiction literature to digital mash-ups of music, the dominant economic approach of the last quarter century focuses on market failure. In the absence of an express license for use, fair use is limited to a narrow set of circumstances where market failure prohibits private bargains from being struck. A classic case for fair use under this rationale is parody of a copyrighted work. In Richard Posner’s words, "negotiating for a parody license" is a "high-transaction-cost negotiation." The logic is simple: few are ready to license a right to be made fun of.

To be sure, fair use is a flexible doctrine that requires case-by-case weighing of statutory factors. But the fact is, even though much user-generated content is noncommercial, and consciously so, it may be illegal under current copyright law where the default rule is get a license. Moms sharing home videos using unauthorized copyrighted music and girls writing themselves into the Harry Potter universe are "pirates" taking the property of artists such as Prince and J.K. Rowling, unwelcome in copyright law’s "safe harbor." In his important book, Convergence Culture, Henry Jenkins calls it a "paradoxical result" where "works that are hostile to the original creators" have "greater freedom from copyright enforcement than works that embrace the ideas behind the original work and simply seek to extend them in new directions."

Law’s current view of fair use, and of culture, is too narrow. My analysis is both descriptive and prescriptive. First, the market failure approach misrecognizes how individuals actually participate in culture. I use the phrase "working through culture" to describe what contemporary cultural theorists from Bourdieu to Foucault to Habermas recognize about how modern subjects engage the world. Foucault describes authorship not as the search for an original subject, but rather as the quest to "grasp the subject’s points of insertion, modes of functioning, and system of dependencies" on existing discourses. Cultural theory elaborates the view that the modern subject is situated within contemporary discourses, and yet is not fully defined by them, either. Increasingly, we now understand that we develop our autonomous selves by inhabiting tradition, not just resisting it.

Furthermore, there are important normative benefits to freedom within culture, from liberty to "think for oneself" to the equality implications of diverse representations of our world, to the ethical responsibility to critique unjust traditions, to more equal distribution of the economic benefits of cultural production. Habermas recognizes communicative action as central to identity formation and mutual understanding.

Let me be clear: in seeking to move intellectual property beyond its narrow economic approach, I do not mean to say that getting the economics of innovation right is not important. But it is not all that is important in setting the metes and bounds of intellectual property. The fundamental failure in the economic story of intellectual property has to do with information’s role in cultural life and human flourishing. It is odd that the area of law most closely focused on Dickens, Rowling, Star Trek, Lost, Gershwin and Prince, is indifferent to understanding these creative works and their relationship to society, and to that part of the academy that seeks to understand these relations. The disciplines of cultural studies, anthropology, philosophy, sociology, science and technology studies, and development studies offer theories of cultural production and capabilities, but their insights have been largely ignored for the elegant simplicity of the economic narrative. Culture is not just a set of "inputs" necessary for further innovation. Culture is the sphere in which individuals create meaning, share ideas and enjoy life with others. Furthermore, culture plays an increasingly important role in promoting freedom in the social, political, and economic spheres of life. Cultural approaches to intellectual property law ought to recognize these interconnections.

Comments

[Tim Cullen]

Professor Sunder:

While I agree with your proscriptions for intellectual property, I actually think it's possible for an economic view of IP to produce a justification for your reforms: I think cultural theory and economic theory (when wielded correctly) produce congruent viewpoints.

Participating creatively in a culture generates social welfare and social capital even when no money changes hands. As you note, the digital revolution has enabled this kind of participation on a scale and variety never seen before. This creates a problem for economists as they are generally unable to measure this new social welfare. The scale of this new participation has distorted traditional economic models which might have been appropriate in years past.

If this social welfare could be accurately measured, then an economic analysis could produce the justifications for the reforms you've identified, like broadening the availability of fair use.

The problem is that modern economics' empirical toolkit isn't up to the task: it can measure money, but not pure utiles (for lack of a better word). Money was a good proxy for utility, but less so in the age of the internet.

Until economists figure out ways to measure the hidden social utility of cultural participation (the behavioral economists are making inroads here; see also the work or Robert Putnam), and until that welfare informs the economic analysis of intellectual property structures, economists' proscriptions will be significantly flawed, perhaps fatally so.

Bottom line: they'll get there eventually, and when they do, economists will agree with you.

[Bruce Boyden]

If we move away from a utilitarian explanation of copyright as incentive to create, toward a recognition of the importance of copyrighted works in our culture, which way does that cut? One answer, suggested above, is that copyright law should be less restrictive in order to allow broader redistribution of that material in the culture. But isn't another answer that copyright law serves an important signifying function by recognizing the importance of the creators of such cultural artifacts? Copyright might therefore be seen as a reward for particularly popular contributions. That would counsel *against* any significant relaxation in copyright's restrictions, since the less protective it is, the less special it is.

[Uzair Kayani]

This is a good topic. I do think there are some blind spots in IP law, but not as many as we think. The following points were interesting:

(1) "the narrow economic account, focused on the production of more goods, does not ask who makes the goods, and whether there is equal capacity to participate in making our culture."

This seems like a point about barriers to entry: some people are able to enter the market for cultural production and others are not. I think economics would explain this by noting that IP law often grants temporary monopolies to producers, and the legally enforced monopoly is, of course, a barrier to entry. This barrier is often overcome either because black markets emerge, or because culture is a durable good and the monopolist cannot control the secondary market in culture. I might have to pay to buy a book but then I can sell it for a dollar to Green Books. Or I might pay to perform a derivative song but that song might lead to other songs that no longer require licenses. This second case suggests that even if the protected work doesn't contribute enough to culture, its positive externalities do.

(2) "Culture plays a critical role in development, and in meeting the U.N. Millennium Development Goals, which include the eradication of extreme poverty, universal education, gender equality, child and maternal health, combating HIV/AIDS, and achieving environmental sustainability."

This suggests that culture is a public good, and so we face collective action problems or hold ups in producing it. The producer of culture does not fully internalize its benefits and the beneficiary does not internalize the costs. We could overcome this by using eminent domain in intellectual property, or by taxing the public and then subsidizing cultural production, for example, through the national endowment for the arts.

(3) "Increasingly, we now understand that we develop our autonomous selves by inhabiting tradition, not just resisting it."

I understand this to mean that we should have complete freedom in choosing which tradition to inhabit. For example, I might decide to inhabit Japanese or Russian culture; I would like the freedom to do so but I might make different choices. Here the problem is larger than IP, because cultures (and identities) are inherently divisive. I cannot inhabit a culture insofar as (1) culture is a social phenomenon and (2) the society whose culture I decide to inhabit rejects me. This has to do with time-honored practices like identity politics, tribalism, excommunication, and shunning rather than IP, I think.

(4) "in seeking to move intellectual property beyond its narrow economic approach, I do not mean to say that getting the economics of innovation right is not important. But it is not all that is important in setting the metes and bounds of intellectual property. The fundamental failure in the economic story of intellectual property has to do with information’s role in cultural life and human flourishing."

I think this is right insofar as economics is concerned with scarce resources and it is unclear whether culture is scarce. If it is not, then there is no point economizing or paying people to produce it. Cultural change, as opposed to pre-existing cultures, has an opportunity cost, though. If we are fine with culture the way it is, we don’t need incentives for cultural production, but if we want it to morph, we will need to pay cultural producers to offset their opportunity cost.

[Michael F. Martin]

This sounds interesting. The challenge will be to come up with quantitative answers with reliability to match the ones provided by the modified neoclassical paradigm now in place.

I like some of the ideas flowing out of positive psychology:

http://brokensymmetry.typepad.com/broken_symmetry/2009/03/rebuilding-a-culture-of-innovation-in-the-united-states.html