Kinsella on Liberty Podcast: Episode 022.
This is lecture 5b (in addition to the 6 main lectures) of my 2011 Mises Academy course “Libertarian Legal Theory: Property, Conflict, and Society.” The main lectures start at KOL018.
Video, Transcript and Slides below.
This lecture's topic is "Q&A"
For slides for the six main lectures, plus extensive hyperlinked suggested reading material, see this Libertarian Standard post. For a listing of the syllabus and topics covered in each lecture, see this Mises Academy Course Page (archived).
For more information, see my Mises Daily article “Introduction to Libertarian Legal Theory,” and Danny Sanchez’s post Study Libertarian Legal Theory Online with Stephan Kinsella.)
Video:
The videos of all six lectures plus this Q&A are also available on this playlist.
TRANSCRIPT
Libertarian Legal Theory: Property, Conflict, and Society, Lecture 5b: Q&A
Stephan Kinsella
Mises Academy, Feb. 28, 2011
00:00:03
STEPHAN KINSELLA: I’m reading Matt’s comment now. I don’t understand how a lack of patent protection would work in some parts of the economy, pharmaceuticals for example. Prices are inflated. Okay, what were the incentives for these companies to extend large amounts of capital? Okay, well, I think I know where you’re going. I’ve heard this. Let me just answer this in a couple of ways. First of all, I don’t know if you’ve read a lot of Rand and others on the anti-trust question, for example. Okay, let me read the rest of it.
00:00:54
Okay, well, I would say first as a libertarian, our view is moral. Our view is moral. That is, the question is primarily who has the property right. So, for example, on anti-trust, a lot of utilitarian-type free market types would say – they have the arguments for why you don’t need anti-trust law. But they’re not really against it in principle if you do need them. They just think that there are good economic reasons to think that anti-trust is not necessary because companies can’t really collude that successfully because of the nature of the market.
00:01:29
But a more principled view is but companies have the right to collude. They have the right to fix prices. As long as they’re not violating anyone’s property rights, they have the right to do that, and I think that’s the fundamental approach to IP. Why do you have the right to tell me I can’t use my own property in the way that I see fit, even with something, my own invention, which is what patent laws do?
00:01:54
So if two companies are competing and they’re trying to find this wonder drug and they both find it around the same time, the first one who gets to the patent office can stop the other one from using their own idea. Why is that just? And I don’t think saying – asking a question, well, what’s the first company’s incentive to invest in this R&D? Asking a question is not an argument. I’m not being critical of you. I’m just saying it’s not an argument, and asking a question doesn’t justify the use of state force against my property rights. I mean it just doesn’t. The only thing that justifies that is if I commit aggression, and the competitor hasn’t committed aggression. They’re just using their own property as they see fit.
00:02:36
Now, I would highly recommend that you go to the free online copy of the book by Michele Boldrin and David Levine called Against Intellectual Monopoly. You can find the link on the resources section of C4SIF.org/resources. There’s a link to their book there. There’s a chapter on pharmaceutical patents, which is always trodded out as the best example of why we need patents. And they do a great empirical case just showing that actually it is not in practice in today’s world that useful, or sorry – that it’s not essential. You have to read it. It’s thorough and just devastating. They show that a lot of the cost of patents are for advertising or for things that are not protected by patents, etc.
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