Copyright’s Distributive Impact

A few weeks ago Brett asked me to read over a paper by Daniel Benoliel that criticized efforts to shape copyright law inspired by distributive justice concerns. Benoliel’s argument is so broad that it likely would apply not only to copyright law, but to all forms of IP. He argues

[I]t is undesirable to instill our egalitarian commitments into copyright law, in which redistribution paradigmatically should remain only a side effect, even if their proposed function in this context is, indeed, rather moderate. In practice, moreover . . . redistribution through the government’s tax, welfare and transfer system may be less discriminatory, cheaper and is likely to be more precise. [emphasis added]

Well, somewhere in the article that “may be” becomes a “will,” given that we all agree on how little we know about the exact interaction between legal rules and the production of copyrightable work. Like so many conservative legal economic critiques, the article presumes that an incantation of “Kaplow & Shavell, Cooter & Ulen” automatically sets the burden of proof on the side with redistributive aims.

To Benoliel’s credit, he does acknowledge theoretical critiques of the legal economic orthodoxy here. But he ignores a style of argument I find far more compelling: empirical evidence that, whatever the egalitarian intent of our (modestly) progressive tax code, it is being systematically undermined in the enforcement phase. As David Cay Johnston exhaustively documents, when an EITC filer is far more likely to be audited than a complicated set of partnerships likely designed only for tax avoidance, it’s not exactly clear that the tax system is well-designed to monopolize the enactment of our redistributive concerns.

I’ll have more to say on the IP-specific aspects of Benoliel’s argument soon. For now, I’ll just make this plea to economists who insist on the comparative advantage of taxes over regulation: When you claim that redistributive taxation will address egalitarian concerns voiced by a proponent of regulation, can you a) identify which tax you will raise in order to redistribute income to the intended beneficiaries of the proposed regulation and b) give us some sense of the likelihood of that tax and transfer occurring? To paraphrase Terry Eagleton: the “pure ice” of theoretical precision is a lovely vision, but one is likely to fall fall flat on one’s face if one walks on it alone to one’s desired destination.

2 thoughts on “Copyright’s Distributive Impact

  1. The difficulty that I have with the paper is that it argues against a distributive justice straw man. There are a variety of critiques of an IP system framed by economic efficiency, only some of which depend on “inequality.” So, framing the debate that way effectively puts the law & economics rabbit in the hat (I haven’t heard that metaphor in a while, so I thought that I’d throw it in). Of *course* when it comes to redistributing resources, direct payments are more efficient than indirect subsidies like IP. But that’s not the question that a lot of (non-law & economics) critics and scholars are asking.

  2. Yes, that’s exactly right. That is a key reason why I wanted to introduce the Walzer/Radin take on equality to this debate. There’s a way in which anti-commodification rules or standards level the playing field in ways that are important to the preservation of the meaning of the cultural products at issue.

    But I would like to go further and argue that, even within a law & ec framework, there are many reasons to doubt the efficiency of the current system.

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