Intellectual property is a valid form of property rights; however, most of the flaws are not with the inherent claims to ownership of the intangible property; but rather the laws allocating these rights. The duration and definitions of what constitutes IP rights can seem arbitrary (p.25). All because the Copyright Act of 1976 mandates the peculiar terms as being:
- “…For works made for hire and anonymous and pseudonymous works, the duration of copyright is 95 years from first publication or 120 years from creation, whichever is shorter (unless the author’s identity is later revealed in Copyright Office records, in which case the term becomes the author’s life plus 70 years) (p.1)…”
This exercise in line drawing is riddled with flaws and subject to the capricious whims of interest groups (the rent-seeking behavior of Disney). Conversely, it is inane to suggest that because the property is not tangible, therefore; we cannot own it because the property lines are not clearly defined (p.2). If IP is non-rivalrous it would be considered a public good (p.534). This is ironic since many Libertarian critics are hostile towards IP and also reject the notion of public goods. Even intangible property is rivalrous and excludable. The confusion is that consumption intangible property is not rivalrous, but the ability to profit from IP is. The first entrant into a new market will be the one to reap the most benefit from the innovative product, service, or process. Consumers will generally see anything afterward as a cheap imitation (unless they can drastically improve the product).
The above statement should not be confused as an appeal to legislative fiat or other state measures to resolve this conundrum. But it is foolish to pretend that IP is analogous to a public good. We can alienate it (in the Lockean sense) through tacit acknowledgment of the first of the idea, patentable process, trademark, etc. Paralleling the first use provisions implied in the prior appropriation water rights regimes in the western United States. The first to put the concept to practical use could claim ownership. Admittedly, the transaction costs of such an informal system would be high. In other words, the government needs to clarify IP rights? Maybe. Hypothetically, producers could eliminate ambiguity through user contracts and licensing agreements (disputes which can be adjudicated in a private or polycentric legal system).