Against Intellectual Monopoly

could
easily be done by some adaptations of machines that are already in use in that or
some other trade, and which are not made only because there would not as yet be
enough employment for them to remunerate the trouble and expenses of making
them" (1890, book IV, chapt IX, par 3, nl).
    6. That competition is not a gala dinner follows directly from Comrade Mao Tse-tung's
observation that the revolution is not a gala dinner either, and from the fact that
competition is the source of an unending, but beneficial, revolution in our ways of
producing the things we like.
    7. That innovations do not, like Athena, spring out fully armored from the head of
the innovator but are the products of painfully long processes of cumulative discovery to which hundreds, often thousands, of independent individuals contribute
is well understood by actual innovators and repeated by an endless list of writers. The most recent discussion of this point we came across, in the business-related
literature, is Berkun (2007), which contains plentiful, interesting examples and abundant reference to the many who argued this point before him, and us.

    8. This criticism of our collaborative information- sharing argument is taken, verbatim,
from an anonymous evaluator of the original book manuscript. This particular
evaluator was incredibly helpful to us, and most of her or his criticisms were right to
the point and most insightful. The serious intellectual debate with our position led
us to substantially revise both the structure and the content of the book. Hopefully,
he or she will find the final version more convincing than the original one.
    9. Fudenberg and Tirole (1991).
    10. From "The `Mary Gloster"' by Rudyard Kipling; being out of copyright this is easily available at a number of Web sites, for example, http://www.poetryloverspage.
com/poets/kipling/mary_gloster.html (accessed February 24, 2008). This was suggested by the same reviewer whom we thanked previously.
    11. Hirshleifer (1971).
    12. Anton and Yao (1994). More recent versions of models similar to that of Anton
and Yao and Hirshleifer (1971) have different applications but the very same clear
conclusion that competition and innovation go well together, while intellectual
monopoly harms the second. See Baccara and Razin (2004) and Marimon and
Quadrini (2006).
    13. Flint (2002).
    14. The broader database on book sales that we mention repeatedly is one we collected
by using a variety of sources and that is illustrated in Boldrin and Levine (2005b).
    15. Liebowitz (2004).
    16. Also suggested by the reviewer. For curious readers, here are the original verses from
stanza 83:

    17. James Bond's brand of gun is described in Fleming (1953).

     

SEVEN
Defenses of Intellectual Monopoly
    We focused at the outset on the many successful industries in which competition and innovation have gone and still go hand in hand. Then, we documented the many social evils that the presence of intellectual monopoly,
in the form of either patents or copyrights, brings about. In Chapter 6, we
introduced a theoretical framework capable of explaining the very same
existence of innovative competitive industries, their evolution, and the call
for intellectual monopoly arising from those industries once they mature
and turn stagnant. Yet we have also learned that the same theoretical framework rationalizing competitive innovations also predicts that innovations
of social value may fail to materialize under competition. This leaves open
the theoretical possibility that intellectual monopoly increases overall innovation. If intellectual monopoly delivers substantially more innovation than
competition, it might be a worthwhile system, despite the many costs we
documented in Chapters 4 and 5. Hence, the issue is worthy of further investigation, which we pursue next in two steps. In this chapter, we examine
the theoretical reasons - other than the indivisibility already discussed in
Chapter 6 - adduced to support the existence of intellectual monopoly. In
Chapter 8, we report on the extent to which patents and copyrights increase
the social rate of creation and innovation.
    We are keenly aware that there are many who argue in favor of intellectual
monopoly. They often provide logically correct reasons why, all other things
equal, intellectual monopoly would deliver more innovation than competition. After all, a monopoly is a good thing to have: holding out the prospect
of getting