Re: ECON: Intellectual Property Again

From: Michael Lorrey (retroman@together.net)
Date: Sun May 31 1998 - 20:26:30 MDT


Daniel Fabulich wrote:

> On Thu, 28 May 1998, Michael Lorrey wrote:
>
> > In any event you DID sign a contract when you bought the illegal information from an anonymous seller: you waived
> > the seller, recognised that the seller made absolutely no guarrantees as it its accuracy, validity, or origin.
> > I.E. you bought into the implied caveat emptor contract that goes with any commercial trade as a base of
> > understanding.
>
> There is a somewhat vocal group of libertarians who insist that an
> implicit contract is a void contract; parties must agree to the terms of a
> contract before they may be ethically enforced. Can you show that this is
> wrong?

'Ignorance of the law is no excuse' A stranger walking into a town who spits on the sidewalk could still be ticketed
for violating the towns no-public-spitting ordinance. In court the judge woule probably count his non-residency based
ignorance as a mitigating factor, would find him guilty, but suspend a fine.

> > > In addition, you get even worse problems when the merchant is also
> > > anonymous. Suppose I post through anonymous remailers and a mail2news
> > > gateway that I have a copy of your manuscript available for anyone who
> > > sends me the price of a copy in anonymous cash. I don't know to whom I'm
> > > selling, and they don't know from whom they are buying. How are you going
> > > to prosecute me THEN?
> >
> > a) Your customers, if caught with the illegal copies in their posession, will be arrested and prosecuted. Their
> > arrest and prosecution will be publicized in the media, thus generating a deterrent effect in the public that
> > will impinge upon your ability to do business.
> >
> > b) nothing is totally anonymous. Anything on the net can be traced. As for your arguments about the cost of
> > enforcement, I can also say that the internet also gives IP enforcement agencies the ability to greatly reduce
> > the cost of IP enforcement, at least in regards to web commerce. I think that these costs will be reduced enough
> > that it will totally offset, and then some, your imagined 'efficiency' of having no IP.
>
> Since I find this scenario interesting, I'm going to run it down step by
> step. You tell me where and how I get caught.
>
> 1) I license the use of a copy of information you created. 2) I encrypt
> an advertisement and a pseudonymous public key to Dave's public key,
> stating that I have a copy of your manuscript available for $0.05.
> Only Dave can read this message; Dave has agreed to broadcast e-mails
> which are sent to him via USENET. After enrypting it to Dave's key, I then
> encrypt the ciphertext to Carol's key, adding a message requesting that
> she send the e-mail to Dave; I encrypt that ciphertext to Bob's key with a
> message requesting that he send the e-mail to Carol and send the message
> to Bob. 3) Bob decrypts the e-mail and sends his decrypted text to Carol
> as requested. 4) Carol, ignorant of who originated the e-mail beyond the
> fact that they sent it to Bob, decrypts her ciphertext and sends the
> remaining ciphertext to Dave. 5) Dave decrypts the e-mail, ignorant of
> its author, and broadcasts it to USENET. 6) Zed reads this message and
> decides to post $0.05 in anonymous money encrypted to my public key along
> with his own public key; he does so through a similar chain of anonymous
> remailers; no one but the first in the e-mail chain even knows who Zed is,
> no one but me knows what the message says, because Zed encrypted the
> e-mail to me before sending it along the chain. 7) I encrypt a copy of
> your manuscript to Zed's public key and broadcast it anonymously.
>
> In this way, Zed and I can conduct a trade perfectly anonymously. If the
> remailers do not keep a copy of the e-mail which they forward (they
> don't), then it is impossible to trace either myself or Zed.

Correct, however, when you purchased your copy from me, I included your public key in its coding, such that if the copy
of your key in my software is removed or altered the software is unusable, and my software has virii built into it to
cause other fine fun things if you try to alter the virii or the code which protects the software with your public key.
THus, you may be able to use the scheme above to copy and distribute pirated versions of my software anonymously, but
since the copies all have YOUR public key embedded in them, i.e. your digital fingerprint, all it takes is ONE of those
recipients of the software to slip up, say, their computers get seized in a drug bust, a hacker bust, or the recipient,
living in a libertarian anarchy, winds up with his computer being stolen, then later seized by a PPA busting the theft
ring, and scanning the computer, finds YOUR public key in the software. They notify me that they found a computer with
my software with your public key on it. If this happens once, you could get away with it. Twice and you are busted.
Three times and my PPA raids your property to serve a search warrant approved by your PPA under the joint operating
agreement my PPA has with your PPA (and if they are the same PPA, they don't obviously need to do that, the can just
raid you for violating your contract with them.....). We then find out how many times your personal bank has received
anonymous 5 cent pieces digitally, and I bill you my $50 licensing fee for the 5,347 copies of my software you sold.
Because you sold so many, I might give you a quantity discount I give to all of my retailers, but I doubt that it would
help much....

> What are you going to do about this?
>
> > But you are talking about a market. Markets are not markets of brand names, but of product types. The cola market
> > is not the Coca-Cola market, or the Pepsi market, but the cola market. Both have different recipes for cola,
> > which are protected by patent, both compete to satisfy the public demand for colas with different products. You
> > cannot say that Coca-Cola has a monopoly on the cola market. Thus my assertion that a patent is not a monopoly
> > stands.
>
> Well, let me put it to you this way: any economist who knew anything at
> all about microeconomics would agree that Coca Cola charges more for Coke
> than it would if anybody could make Coke, and that this is because it is
> the only company that makes Coke. They would also agree that increased
> prices lead to decreased quantity. They would agree that this decreased
> quantity coupled with increased prices would represent deadweight loss, or
> economic inefficiency, and that all else being equal this will drag down
> the macroeconomy.

Not necessarily. If a product costs x amount to produce, and given an acceptable profit margin, a company would need to
charge, say, $50 for something, yet its demand curve for a competitive market would cause the retail price to be $25, I
could not bring my product to market if anyone at all could just copy it. Preventing a product from coming to market at
all is its own inefficiency.

>
>
> If you don't want to call this a monopoly, that's OK with me, but please
> excuse me if I agree with the textbooks on this point.

I've read the textbooks too, sir, and they say you are wrong. The definition of a monopoly applies solely to product
type markets, not markets for individual brand names. The soft dring market will divide down to the special market for
colas, in which several brand names with recipes with slight differences compete. There are colas which sell for half
of the price of Coke, yet do not command the same market share as Coke does. Use of brand names is legally protected,
not as a matter of IP, but of fraud. Lets say that there was no Coke.

There are a large number of colas that compete on the market. I make a cola called Mike Lorrey's Cola, bottled in
Lebanon, NH. The cola happens to have a distinct DNA marker in it that matches with the DNA in my semen cells. THis is
the fingerprint that identifies the cola as produced by me. Slick Danny Fablich decides that he likes the market share
my cola has, and decides to produce a cola that he labels Mike Lorrey's Cola, bottled in Lebanon, NH.

I can sue him for a number of things which have absolutely nothing to do with my IP rights to my product recipe.

> > So you are for treating IP as a commodity. Any commodity market is going to trend toward an oligopoly situation,
> > as economies of scale push smaller producers out or up in the market. Why is this? Because in the case of
> > internet commerce, bandwidth is discounted for large users, and hardware like servers, routers, drive systems, CD
> > writers, etc. are all cheaper on a per kilobyte basis the larger capacity you go.
>
> Are you saying that it would be a natural monopoly? If so, since when are
> libertarians opposed to natural monopolies? Also, I disagree with your
> assertion that all commodity markets tend towards monopoly thanks to
> economies of scale. There are lots and lots of commodities on the market
> that aren't monopolistic, never have been and don't look like they're
> about to become monopolistic in the near future. The existence of such
> markets disproves your assertion that all commodity markets have this
> behavior, though it may nonetheless be true for IP.

All commodities which are produced in a manner or method which allows for economies of scale, will in a matter of
time, move toward monopolistic/oligopolistic markets. Any product in which the combined fixed and variable costs cause
the marginal cost curve to become asymtotic to a Y axis value, become flat, or sloped downward will trend toward
monopolies.

>
>
> > In this scenario, the small home grown inventor is discouraged from becomeing a player in the market, unless they
> > are a rich bachelor who expects to get ripped off by the big boys, playing it off as if they are great
> > philanthropists, humantarians, etc..., or ulness the home grown inventor sells out to the established players in
> > the market. You are not encouraging a free market, but encouraging oligopoly/mercantilism.
>
> If you are correct, and it is more efficient for a monopoly or oligopoly
> to produce the goods than it is for small producers to compete (or sell to
> them), then by encouraging this process we are encouraging a free market;
> this is because in the case of a natural monopoly, the free market is not
> competitive. I am not convinced that this is actually the case, but it
> does not help nor hinder either of our arguments if you are right on this
> point.

Except that once a natural monoply is established with whatever technology is available at the time, it will tend to a)
purposely retard technological development, b) prevent technological developments which do occur from changing its
'natural' status, c) a natural monopoly will tend to cause the spontaneous organisation of statist organizations, which
will threaten the stability of the libertarian society, and will use these statist organizations to help enforce its
continued 'natural' monopoly status.

>
>
> > Yes it is weird, but your numbers for the present market are not worth extrapolating from as it still is less
> > than 0.1 % of the market, yet even if LINUX catches on in the market beyond the hobbyist or iconoclast, companies
> > like Red Hat will not make any decent level of revinue, until one of the established companies, like Microsoft,
> > comes along and modifies the OS into something which it can protect, LinOS II. They then will promote this, and
> > soak up the entire market, putting Red Hat out of business, or back in the hat closet.
>
> Most Linux users would disagree; they argue that the reason Linux is good
> and growing (some say that it is already better than Microsoft's product)
> is because anyone is free to modify the source in any way they want, but
> they are also prevented from protecting their invention under the GPL.
> This means that it is easy for anyone with a good idea to improve the OS,
> rather than wait for Microsoft to release the next version of its
> bloatware.
>
> Also, if there were no IP laws, information like Linux would make up 100%
> of the market, not 0.1%. Remember, I'm not trying to say that Linux is
> going to beat Microsoft in today's market; I'm just saying that Linux
> continues to improve despite the fact that nobody can protect their new
> Linux code. This flies in the face of your assertion that if inventors do
> not receive royalties on their inventions, they will not invent. They
> will invent, only slower.

And the people who do the inventing will be indviduals will other means of material support who do the inventing for
kicks. Just the idea of slowing technological advancement purposely should be enough to make anyone who claims to be
extropian or transhumanist to automatically disavow any support of the anti-IP cause.

> > It would be a good thing. However I think that your expectation is wrong, and even if it does gain efficiency, it
> > will be because the commodity market for IP pushes invention supply into an oligopoly situation, which any self
> > proclaimed libertarian free marketer should abhor.
>
> I don't abhor natural monopolies, nor should any other free marketer. It's
> the COERCED monopolies that we have to worry about. Also, I am not at all
> certain that the market for IP is naturally monopolistic, and I definitely
> disagree with your assertion that all commodity markets monopolize.

Its obvious to anyone who has done inventing before, and actually gone through the work of bringing their invention to
market with a start up company, that given the high capital costs of invention, which when amortized on a per unit rate
on your price/quantity scale will cause your marginal cost curve to asmtote out at a fixed Y axis value, or flatten out
entirely, or even cause it to slope downward, rather than upward. In this manner, a given invention would be most
efficiently brought to market if it is a monopoly product. Failing to protect the IP rights of the inventor will do
nothing but retard the capital supply to invention development, and thus retard technological development.

> > Considering that the economy is still pretty planned, with most industry still in the hands of Communist party
> > apparatchiks, I think that a) most of its economic growth is from externalization of western IP costs via
> > pirating of foreign owned IP properties, and the rest is b) from internal IP that is owned by state industries
> > and enforced by party apparatchiks with connections with police or army authorities, or c) small consumer
> > businesses, mostly in the service industries, that are privately owned.
>
> I don't think you can get much more qualitative than this analysis, which
> was all that I was trying to show. This is not to say that it is wrong,
> necessarily, but simply that you can't do this quantitatively; you MUST be
> qualitative.
>
> > yet you claim with a wave of your hand that nicroeconomic efficiency is beneficial for the macro economy without
> > showing HOW it benefits the macro economy, WHO in the macroeconomy truly benefits, and refuse to measure the
> > effect in the macro economy of the disincentive to invent on the rate of invention, and reduction in productivity
> > that results from stagnated technological development.
>
> Well, figure it out yourself. The portion of surplus which is above the
> price line and below the demand curve is consumer surplus; that below the
> price line and above the supply curve is producer surplus. If IP were to
> be eliminated, consumers would gain more than producers would in the copy
> market (see http://pantheon.yale.edu/~dgf4/incent3.gif ); also, the
> increase in consumer surplus when demand increases is greater under
> perfect competition than under a monopoly, while producer surplus is
> greater under monopoly than under perfect competition, as noted.
>
> As for how it benefits the macroeconomy, you should know this perfectly
> well: all else being equal, increased total microeconomic surplus results
> in increased nominal GDP. However, this is similar to the argument for
> kids drinking milk: all else being equal, a child will grow taller if
> they drink milk than if they don't drink milk. How much taller? I cannot
> say. All I claim to know is that microeconomic efficiency is better for
> the economy than microeconomic inefficiency, but I cannot tell by how
> much.

But you also must account for the law of diminishing returns in this analysis. At some point, your kid aint gonna grow
no more no matter how many swimming pools of milk you pump through the fella.

>
>
> > I would love to see links or book refs to anything that shows that you can determine the relative size of two
> > shapes without knowing the quantitative size of either shape. Sounds like magic to me.
>
> Look, you want a REAL REAL simple example? Suppose I have a triangle
> formed by the points (0,0), (x,0) and (y,0) and a triangle formed by
> (0,0), (z*x,0) and (y,0) where z is less than 1. The latter triangle will
> have less area than the former triangle. I have no idea what their areas
> will actually be, but I know their relative sizes on a qualitative level.
> No magic, just math. If I know enough about the supply and demand curves,
> then I can use the same "magic" on the area of the deadweight loss, the
> increase in revenues as demand increases, and the quantity produced by
> monoplists as opposed to that produced under competition.

I can understand that you can see at a glance that one shape is gonna be roughtly larger than another, that is obvious.
What is not obvious at all is how you can purport to just scribble some lines down on a piece of paper as if they
actually are applicable to the real world, without any actual quantitative numbers determining their coordinates, and
come up with a claim of 50% and 40%. If you have no quantitative numbers, what is the 40%, 40% OF?????? 40% of nothing
is still 0.

>
>
> > Yet you show no quantified relative size.
>
> I never claimed to! Did you read my conclusion?

Yes, and you made claims of 50% on one figure and 40% on another, when you stated absolutely NO numbers from which
these percentages are derived. Pure slieght of hand, sir. WHAT ARE THE NUMBERS YOU GET YOUR PERCENTAGES FROM?????

> All I said was: "To
> conclude, if we let A be the area of the blue trapezoid under perfect
> competition, M be the area of the blue shape in the monopolistic diagram,
> D be the area of the grey triangle and E be the cost to society of
> enforcing IP laws, then we should eliminate IP laws if D + E > M - A, or
> if A + D + E > M."
>
> > Also, since you only count marginal costs, not fixed costs, your chart
> > is absolutely meaningless, especially in an IP marketplace, where almost all costs are fixed costs (i.e. R&D),
> > while the marginal costs of reproduction are nil.
>
> Almost nil. That was the low red line in the third graph. As for fixed
> costs, you're right, they don't show up on the graph, but they were the
> central point of my use of those graphs: if the increase in revenues is
> greater than the fixed cost of invention, then invention will take place,
> if not, then it won't. This was the principle I set out in bold; I
> believe it is the most robust part of my analysis because it is so
> trivial. If you disagree with this part of the analysis, (and there's no
> reason why you should: a priori, you could still be right even if this
> were true) you'd better provide your OWN graphs showing why mine are
> wrong.

Because with greater and greater levels of technological development, invention requires greater and greater levels of
capital investment, which mush be amortized in your marginal cost curve. Given an advanced enough technology, your
marginal cost curve could even slope downward rather steeply, rather than upward. A downward slope is a natural
monopoly.

>
>
> > Additionally, your measure of efficiency, i.e. the quantity
> > made available in the marketplace, is wrong. The efficiency differential is measured as the change in price
> > times the change in quantity.
>
> Gee. Funny how the area on the supply/demand graph is given in precisely
> those units: Price times quantity.... SAY! Wait a minute! You don't
> suppose it's a microeconomic PRINCIPLE that the change in efficiency is
> given by the change in area on the supply/demand chart, do you? Naw. It
> couldn't be...
>
> Why do you think I spent all that time harping on about area, anyway???

Great, but get it right. You only claimed that the change in quantity was the measure of efficiency.

> Geez.
>
> > In addition, you also only use straight lines in your graph, which any microeconomist can easily tell you are
> > simplistic and inaccurate of a real market. The demand, cost and monopolist market line all will tend to be
> > S-curves of one degree or another, depending on the product, the state of the art at that time, consumer
> > confidence and utility, etc. In a market with such S-curves, the efficiency gained can be reduced or amplified
> > over your straight lined graph, depending on how the lines intersect.
>
> As you surely realize, I used lines because they're shitloads easier to
> draw. If you want to draw out your own graphs using S-curves, go right
> ahead. I'm anxious to see them. So long as your curves don't violate any
> principles, they will show the same qualitative results as mine do.
>
> > Because it is thanks to piracy in other countries, it is unprofitable. Since a piracy enforcement agency, whether
> > a government or a PPL, cannot operate in a monopoly state jurisdiction without the expressed approval of that
> > state monopoly, and must operate within the legal guidlines set by that jurisdiciton, any state that wishes to
> > shelter piracy can make it unprofitable to enforce IP rights. Just as most terrorism and guerrilla warfare is not
> > successfull without the shelter and support from states outside the zone of conflict, IP piracy is only sucessful
> > with the direct participation, shelter and support of state monopolies.of power. Dont' make me label you a
> > pro-statist.
>
> I don't understand. It would be unprofitable to produce tamper-proof
> software BECAUSE it is more tampered with in other countries? Care to
> back this up a little more?

It is unprofitable to produce tamperproof software to help enforce IP laws overseas if the overseas countries do
nothing to enforce the IP laws they have in the first place. It doesn't matter what you do to your software at this
point, The state monpolies who get paid off by their domestic pirates will protect their domestic pirates before they
will observe their treaty commitments under GATT. If we lived in a worldwide libertarian society, where everyone lives
in communities with competetive PPAs, my PPA would have joint operating agreements with other PPAs, such that any one
PPA in the world is only one or two direct agreement links away from the PPA of the guy pirating my software.In which
case, I would be easier for me to enforce my IP rights in such a condition than it currently is where state monopolies
protect their domestic pirates that copy foreign software and other products.

> > And it is just as easy to have programs written on a CD which automatically run when the CD is accessed. This is
> > how viruses get away with their mischeif. While AV software may be able to wipe a virus on a floppy, a) on a CD
> > there is plenty of room for multiple copies to watch over each other, and b) a CD cannot be overwritten that
> > easily.
>
> Again, all I have to do is build a computer emulator that copies instead
> of executes (especially easy when we're talking about CDs) and all the AV
> software in the world wont help you as I burn myself an identical CD with
> all of the AV software intact, and pop it into my real computer. The new
> CD is no different from the old CD as far as the software can tell; what
> will the AV programs detect if they are never executed?

It doesn't matter how many times you copy my software. My software is TAMPER PROOF, not COPY PROOF. Every copy of my
software you produce is gonna have your public key embedded in the coding of the software, so if I catch just one other
person with software with your public key in it, I can bill you for the license fee for that person. ....and it will
give reasonable cause for my PPA to seek to have your computer assets seized for independent legal investigation.

>
>
> > > Beg your pardon? By precisely how much will the incentive to invent
> > > change?
> >
> > It can be measured by the percentage of patents issued which are brought to market with the help of measureable
> > capital investment. Since capital invested in such a risk investment will demand a given return on that
> > investment, if the total on investment is reduced by the lack of IP protection to the point that the given rate
> > of return on investment demanded by the capital market will dictate that the amount of money an inventor can
> > raise from investors for a given invention will decrease below the point required to bring the given invention to
> > market, then the inventor will not bring that particular invention to market. I don't have any data right now, so
> > I am not making any blind guesses (unlike you).
>
> Yes, this is all true. However, how do you propose to measure the
> demanded return on investment on IP in America without IP laws, all else
> being equal? China won't cut it; planned economies don't let this
> mechanism work at all. You've got to use America and all else must be
> equal in order for this mechanism to apply; in other words, you can never
> make this measurement.

Sure I can. There are plenty of products on the market which have absolutely no patent protection. Compare those with
products which do have patent protection and you can develop a metric of comparison.

>
>
> > > My argument has been qualitative, arguing that the incentive to
> > > invent would decrease, but not specifying absolutely by how much.
> >
> > Which is simply a cop out.
>
> Well, go get your data and we'll see how YOU do.
>
> > And I say that since the supply of inventions will contract markedly, your pricing will not change much, until
> > consumer demand outstrips supply, due to population growth and limited resources, and no change in resource
> > utilization efficiencies do to stagnated tefhnological growth. At which point you will have inflation and
> > economic stagnation.
>
> Actually, interestingly enough, NOT if you are right about that natural
> monopoly thing. In that case, the big monopoly on invention-commodities
> will have an incentive to pay a premium for inventions, up to but not
> exceeding the area of the blue shape in my incentive analysis. Inventors
> will therefore have an incentive to invent given by this shape, just as it
> is today. That is, in that case, the incentive to invest is EQUAL in both
> systems, as well as the deadweight loss. The only difference, then, is
> the cost of enforcement; again, the vote in my favor, not yours.

My argument applies twofold. If there is no IP protection, then only big companies will be able to protect their
proprietary information, and out compete anyone who does steal their inventions, due to economies of scale production.
IP protection merely allows any individual to be protected from theft for enough time for the individual doing the
inventing to establish a business that can produce to the demands of the natural monopoly for that given invention

Seeing as how libertarian philosophy is about empowerment of the individual, IP law protects the right of the indvidual
to create their own monopoly without having to have a huge corporation already at hand to produce and protect that
information. Libertarians should be for a policy which gives the economic advantage of opportunity to the individual

>
>
> Meanwhile, even if natural monopoly does not take place, the blue
> trapezoid under competition expands when the demand for inventions
> increses, so there IS a demand effect on the incentive to invest; again,
> smaller, but not zero.

It all depends on the ratio of fixed to variable costs. If for example, my invention takes $10 billion to develop, but
only $0.10 to produce each indvidual unit (like many medicines), the capital costs so far outweight the costs of
production that the marginal cost curve slopes downward, rather than upward. In this case, if the drug can be copied by
anyone with a decent spectral analyser and chemical modeling software, and there is no IP protection, no rational
investor is going to invest $10 billion for a drug, when most of the benefit for the investors capital will be to
investors who DONT invest in the company......

>
>
> > Yet any web server/router/backbone owner will have a contract with an insurance company to protect their assets,
> > especially if they have capital leins on the equipment. In a libertarian world, any sane insurance company will
> > require that the network asset owner subject himself/herself to the authority of their contracted PPL. Most or
> > all PPLs will have interlocking contracts of enforcement. Thus you will be able to track anyone on the net that
> > vilates your IP contract, and you are covered by your IP protection clause in your insurance policy. Anyone you
> > license your property to will have to subject themselves in your license agreement to ajudication and enforcement
> > of your self licensed IP rights, ergo your PPL can do a network audit on your customers networks, on their ISP
> > routers, etc. In an internet world, the cost of IP enforcement will go down remarkably.
>
> I think I see. So your PPA will go to the PPA(s) of all of those who
> reside on my anonymous remailer chain and get them to tell who I am. The
> problem with this policy: this is effectively key escrow, which has been
> proven many times over to be inefficient. If you have to hand over your
> keys when the government/PPA says so, you can't do electronic commerce
> securely. Period.

No. Everyone will have your PUBLIC KEY. That is definitely NOT key escrow.

> If e-commerce is more efficient than physical commerce
> (And there is a great deal of evidence that this is the case,) then
> enforcing key escrow results in economic inefficiency. So again I fall
> back on Friedman's rule of thumb: if it is economically inefficient, it
> will not be enforced under anarcho-capitalism.
>

SInce you will be using your public key all the time, such that credit agencies will keep copies of your public key on
file at all times, when you license my software from me, your public key will be affirmed by the credit agency, then
embedded in my software. Possibly it could be coded such that only a person with your private key could then actually
operate the software.

> > > The cost of invention is sunk, which means that it doesn't change the
> > > shape of the supply curve. Competitive disadvantage only takes place when
> > > your supply curve is higher than the other guy's supply curve, so this is
> > > clearly not the case. Instead, we see from the graphs that invention is
> > > only profitable if the increased revenues from invention outweigh the sunk
> > > cost of invention; this incentive is smaller than that under a monopoly,
> > > but not zero.
> >
> > I think that this is a totally bogus claim. You are completely off your rocker here.
>
> What? That sunk costs do not result in competitive disadvantage?
> Competitive disadvantage is a technical term which refers only to the
> supply curve, which is really not affected by sunk costs, honest to
> goodness; you can go look it up. Perhaps you meant something else? The
> average cost curve?
>
> > Simplistic, basic microeconomic charts, any skilled economist will tell you, have ABSOLUTELY NO RELATION to any
> > real world microeconomic scenarios. To make generalizations from a generalization like you are doing is the
> > height of ignorant arrogance.
>
> Yet they will agree that microeconomic efficienccy does lead to increased
> GDP, ceteris paribus. It's the ceteris paribus which most economists will
> catch you on, but since all I was trying to prove is that IP laws are
> economically bad for us compared to not having them, microeconomic
> efficiency is the perfect choice.

Not true. Since we are agreeing that nicreconomic efficiency is the crux of the argument, we need to to get down to
brass tacks in a quantitative manner before we can decisively determine who is right here. Until then, your ideas,
though interesting, are not credible.

--
TANSTAAFL!!!
   Michael Lorrey
------------------------------------------------------------
mailto:retroman@together.net Inventor of the Lorrey Drive
MikeySoft: Graphic Design/Animation/Publishing/Engineering
------------------------------------------------------------
How many fnords did you see before breakfast today?


This archive was generated by hypermail 2.1.5 : Fri Nov 01 2002 - 14:49:09 MST