Copyright's Empire: Why the Law Matters

INTRODUCTION I. LAW AND ECONOMICS ANALYSIS IN COPYRIGHT A. Positive Externalities in Markets for Information Goods B. Information Goods: The Cause of Market Failures C. Correction of Market Failures Through Institutional Intervention II. TECHNOLOGY AND THE LAW OF COPYRIGHT A. Capturing Social Surplus in Markets for Information Goods B. Correction of Market Failures Through Technologies C. Copyright as an Institution for Balancing Private Control and Public Access CONCLUSION INTRODUCTION Two separate and distinct movements have colonized research in the field of intellectual property. The law and economics movement has deepened our understanding of the justification for granting monopoly rights over intellectual property; in more recent years, theories in the movement have been used to support the growth of the commons--the free environment where intellectual property plays little role in generating new creative works and innovation. The second movement is the law and technology movement that has sought to increase understanding of intellectual property through the exploration of how technologies either provide freedoms or impose limitations on how creative works and innovation are created and received by society. The advent of the information age and the infiltration of the Internet into our homes have allowed the ordinary citizen to participate in the process of creating new literary and artistic works and distributing those works across channels opened by new technologies. Scientific research takes on a completely different meaning as new technologies allow DNA sequences to be analyzed through complex three-dimensional computer generated models. (1) This movement has increased our understanding of the legal dimensions of new technologies and the effect these technologies have on society, whether in real life or online. The impact of these two movements on many fields of law has increased our understanding of the law of intellectual property and its effect on society. One thing is clear from the literature: a balance must be achieved between incentives to produce for the creator of a work and access to information, knowledge, and content by the users. Applied to copyright law, the combined jurisprudence of law and economics and law and technology provides insight into addressing the balance between private rights and public interest. The main issue facing copyright law--the extent to which public access to creative works may be the underlying rationale for the imposition of limitations upon the reach of copyright law, particularly in an age where access to information and knowledge is facilitated by technology--arises from constitutional intent. As outlined in the U.S. Constitution, authors are to have exclusive rights to their writings to promote the progress of arts. (2) Implicit in this is the notion that the ultimate aim of the grant of monopoly rights is the progress of arts for the greater benefit of society. (3) One historical underpinning of the development of copyright law was to encourage learning (4)--this was done by rewarding authors for using their talents to the ultimate benefit of the public. (5) The grant of the copyright monopoly was the most efficient way to enhance pubic welfare through the works of authors. (6) Law and economics jurisprudence does not provide compelling arguments to support the notion that the copyright monopoly is the most efficient way to maximize public welfare by promoting the works of authors. In fact, Justice Stephen Breyer, in his tenure piece at Harvard Law School, entitled The Uneasy Case for Copyright: A Study of Copyright in Books, Photocopies, and Computer Programs, (7) argues that the economic justification for granting rights to authors to encourage authorship cannot be proven. (8) However, economic theories regarding the creation of market externalities, the causes for market failures, and the correction of market inefficiencies provide evidence in support of retaining the copyright system as the means of correcting these market failures and inefficiencies and to encourage authorship. …