Do we have the optimal amount of Bainbridge?

Over at his blog, Steve Bainbridge has this post up:

Jeff Jarvis has a very funny rant against Google and other RSS cachers, whose humor masks an important point: A lot of Internet portals, but especially Google, are basically ripping off content providers. As an author, I'm already annoyed by Google's relentless drive to make my books available on line for free to all and sundry, which seems to be where they eventually want to get. As a blogger, it's less of an issue, but the larger point is that Google's disrespect for content providers has already caused it problems through litigation and may cause society problems if disrespect for intellectual property rights by Google and its ilk leads to a reduction in output from content providers and/or reduced access to new content. Where's the incentive for authors to write, for example, if Google's getting rich giving away the authors' product without compensating the author?

I think he might be joking, but if not, I'm sure his take is a bit overblown.  Here's a couple of things in response: 

• Google's "disrespect for content providers" is at worst a double-edged sword:  The service would go a long way toward reducing search costs, and even Bainbridge would be a beneficiary of that.  In the end no one can be certain which way it will (or would) cut, but it isn't all bad.
• I would think that the issue demands at least a passing glance in the direction of transaction costs.  Google's "disrespect" is intimately related to the thorny problem of opt-in/opt-out license in such a system.  If the idea has any merit at all (and plainly it does), it's not at all clear which regime is better from a social welfare perspective:  The one that preserves the author's veto at high cost and thus at the expense of completeness, or the one that recognizes an exception (say, fair use) for the sake of completeness.  I'm not suggesting I know which is preferable, but there's a powerful defense of the latter that doesn't turn on Google's rapacious disrespect for authors.
• The best part is the claim that, absent maximal enforcement of copyright, we'll have fewer works by profit-maximizing lawprofs out there.  First off, I say, "if only!"  Secondly, however, I am certain that there are other incentives for lawprofs to create.  (I know Bainbridge's comment was not limited to lawprofs, but as he is clearly concerned primarily with his own books, I'm just going to focus there, as well).  And as I frequently remark to my law and economics class:  It's not that we want maximum incentives; it's that we want optimal incentives.  In fact, I'd say those incentives are already beyond optimal.  As one data point, I ask you to look at the copious amount of crap produced in our law reviews.  A little less incentive might do some good.  (I know, I know -- few profs get royalties for law review articles.  But I have to imagine that the number of lawprofs and the level of their output are affected on the margin by the prospect of book royalties.)  I'm not saying enforcement of copyright should be weakened, I'm just saying that if your concern is that we'll get less output without that right, in some cases that may actually be a good thing. 

I understand that, as an author, Bainbridge wants compensation for his work.  I support that entirely -- it's really a question of how much compensation.  And I'm as big a supporter of property rights as the next guy (well, that may not be true once Henry starts blogging).  But the claim that society will crumble under the weight of innovations like Google's strikes me as, shall we say, insufficiently nuanced.

Comments

[Robert Schwartz]

There have been two substantial extentions of copyright in the past 30 years. Has anybody measured whether they have affected the output of contents?

[Kate Litvak]

Stripping authors of their copyrights is a tax on good authors, whose work people actually want to buy. Bad authors need not worry -- nobody is rushing to pay them anyway. So, if the goal is to reduce the amount of junk published by law professors, taxing people like Bainbridge is exactly the wrong approach.

Instead, we should tax people who write junk. Since it will be hard to separate, say, the bottom 20% without major controversy, perhaps we should tax best available proxies of junk – like, any mention of “cognitive biases,” “stakeholder primacy,” and “unfair prices.” (People, lighten up, I am kidding, ok?)

And, of course, if you think law review editors are able to evaluate scholarship on the merits and select the best stuff, then, the optimal way to reduce junk is to shut down most law reviews.

[geoff]

Kate: I don't think anyone is suggesting "stripping authors of their copyrights." I would be wholeheartedly opposed if that were the case. Here the question is really about the scope of the (well-established) fair use exception. Personally, I'm a fan of the fair use exception. It's utterly consistent with a strong property rights approach -- it just recognizes that, taking account of transaction costs, some property rights should be allocated to users rather than authors. I realize, of course, that it can be abused and over-extended (as many would like it to be), and if it were a choice between no fair use and an overly-broad fair use exception, I might side with you on the former. But I don't think that's quite the choice we face (at least not yet).

As for deterring the good authors but not the bad ones: It's a good point. Except I'm not sure they can be so easily identified (even by themselves) ex ante. I bet a lot of really bad authors think they are good and vice versa. Of course, over time, sorting becomes a little easier (although even good authors write crap now and then), but it's an open question whether the benefit of deterring the bad ones would outweigh the cost of deterring the good ones.

I'm in complete agreement, however, about what to do if we really want to deter the junk. Maybe once he joins us my dad will tell the story about how he abolished the student-edited law review at George Mason years ago. I don’t recall the details, but I do know that, in the face of serious student revolt, the abolition didn't last long.

Oh -- and don't back off your more creative plan so quickly! I think you have a really good start. Perhaps we could add "heterodox economics" and "fair trade" to the list, as well.

Robert: I don't know if any good work has been done here. It's a good question. I imagine that reliable results would be very difficult to come by -- here's one study (http://www.comp.nus.edu.sg/~lung/Movies.pdf) with results that look pretty unreliable to me (and which are, at any rate, inconclusive). Maybe a copyright scholar out there can help us out?

[Kate Litvak]

Even if the great H.M. couldn't kill law reviews at his own school, I don't know who can... SSRN is my last hope.