“In fact, if artists and inventors were not optimistic about their ability to make
money, it is very doubtful that anyone would still be willing to engage in creative activity.”
Ofer Tur-Sinai, The Endowment Effect in IP Transactions: The Case Against Debiasing
NB: this paper was a free SSRN download. Just sayin’.
I recommend he consult this thorough, yet free Wikipedia page: http://en.wikipedia.org/wiki/Irony
ReplyDelete"heightened valuations of IP goods are often driven by emotional attachment, making such valuations fully consistent with the rational choice model"
ReplyDeleteum, okay
Mark, that's actually one of the relatively few things in the paper I agree with. In ordinary property transactions, we don't say that there's anything wrong with refusing to sell for sentimental reasons, even if someone offers more than market value (or at market value, for that matter). Individual attachments are, in real property, not a matter that needs fixing, in part because the theory assumes that this will generally all come out in the wash--the would-be purchaser will find someone else willing to sell a sufficiently similar piece of property at market price. Or, more specifically, in the absence of an applicable discrimination law, I can refuse to sell to you because I just don't like you, or because you're going to use the property in ways I don't like. That's not market failure, it's market.
ReplyDeleteThe trouble with that in IP, obviously, is that it guts transformative fair use/criticism, which has always been off the table. So we do disregard individual preferences at least in some cases. Thus, IP is simply not amenable to a truly unflinching market failure analysis. And there, of course, is one place where I think this paper goes wrong.
Perhaps I've misread you, though, and the criticism is more of the idea that rational choice can provide a useful account of a person who has idiosyncratic preferences, since it has no useful account of preference formation or shaping in response to given circumstances. In that case, we are in full agreement.
In fact, if artists and inventors were not optimistic about their ability to make
ReplyDeletemoney, it is very doubtful that anyone would still be willing to engage in creative activity.
Because the profit motive is the only reason anyone ever does anything. Right.