When Are IP Rights Necessary? Evidence from Innovation in IP's Negative Space
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Description
The law and economics of intellectual property has long rested on a foundational, if implicit, premise: that intellectual property (IP) law is best understood by studying how legal rules operate in actual markets for creative work. To understand copyright, for instance, scholars have explored copyright-dependent fields such as music, film, and publishing, seeking to understand how copyright law shapes innovation in these particular contexts. In other words, IP scholars have generally studied creative fields that rely on IP. The assumption that we best understand a body of legal rules by looking at the fields they directly address is eminently reasonable and seemingly so obvious that, until recently, it was almost never questioned. Yet this way of analysing the effects of IP is incomplete. IP rules are purposive; the core goal and rationale of IP is to incentivize creative and innovative production. Put differently, IP rights are granted and enforced by the state because they are believed to have significant effects on behavior, spurring innovation that would not occur in their absence. Thought of this way, looking only at the creative fields that IP law addresses is misguided. It leaves open, or at least incomplete, a host of important and fascinating questions. Can innovation flourish in the absence of IP protection? Can market incentives, psychological factors, social norms, first-mover advantages, or any number of other causes, including path-dependency or even happenstance, serve as whole or partial substitutes for IP rights? And is it possible that, under some conditions and in some industries, IP protection is counterproductive—that is, it inhibits more innovation than it promotes? To answer these questions, we must look beyond the space affirmatively covered by IP law. We must look instead at what we call the ‘negative space’ of IP. By ‘negative space’ we mean those creative and innovative fields that, for historical, doctrinal, or other reasons, are not addressed by IP law. In fashion, cuisine, tattoo artistry, professional magic, financial services, sports, and many other innovative endeavors, IP rights are absent or highly limited. IP as a causal variable either is out of the picture or is marginalized, even if IP rights sometimes apply as a formal matter. As a result, these fields provide an illuminating and sometimes arresting take on the relationship between IP and innovation. In this chapter, we explore the concept of IP’s negative space and the scholarship that has begun to grow around it. This literature is barely more than a decade old, but in important ways it has shaped how scholars today think about IP. The negative space literature is predominantly focused on copyright, but there is no reason it cannot apply to at least some industries that are within the domain of patent, which shares copyright’s incentive justification. Because the underlying rationales for trademark are so different, insights for trademark law are more limited. But the reverse is not true. One implication of much of the negative space scholarship is that the role of brands and marks in shaping innovation and innovative industries may be quite powerful, especially in those fields where copyright and patent are absent or weak. In the remainder of this chapter we first briefly define the concept of negative space. We then explore what has been learned thus far, surveying the growing range of research into ‘intellectual production without intellectual property’. We conclude with an assessment of this line of inquiry and offer some key questions for future research.
Source Publication
Research Handbook on the Economics of Intellectual Property Law
Source Editors/Authors
Ben Depoorter, Peter S. Menell
Publication Date
2019
Volume Number
1: Theory
Recommended Citation
Raustiala, Kal and Sprigman, Christopher J., "When Are IP Rights Necessary? Evidence from Innovation in IP's Negative Space" (2019). Faculty Chapters. 1738.
https://gretchen.law.nyu.edu/fac-chapt/1738
