Maxliberty:Of course we live in a true anarchy environment.
Maxliberty:The cost of keeping the Coke formula secret is not a meaningful factor in the price of a can of Coke.
You can't know that. I don't suspect people buy coke because it's taste has not been replicated, but rather because it has massive brand power and is part of a global distribution chain rivalled only by Pepsi. Does Pepsi have a secret formula? What is their relative market share over the last 10 years?
Maxliberty:However, if the value of keeping the secret is greater than the cost then it makes sense for people to do this.
Correct, but that determination is not made only by the person with the secret, but the person who would potentially be exposed to the secret under some form of agreement. Value is set by two parties in exchange, not arbitrarily by one party.
Maxliberty:This is the point of the NDA, you can't buy KFC chicken without the NDA and you know that people want to buy KFC chicken so you sign the deal.
Again, there are lots of people selling similar products (fried chicken, picnic style fast food) without the same restrictions. So the NDA might protect people from producing KFC chicken without an agreement, but it doesn't stop anyone from producing fried chicken, or copying KFC's formula through experimentation or duplication. Now we get away from patent and go to copyright. Licensing the use of the brand KFC chicken, that does have value, because in a free market, it would be fraud for me to call my chicken KFC chicken if it was not.
Philosophically, we're not far apart on IP, you just have a very narrow view on it.
I don't really care what happens, as long as coercion isn't involved. If I have to sign a NDA for every good and service I buy, the market will find a way to streamline this process so I don't get carpal tunnel or require an education in contract law so that I can participate in the economy. Either way, I'm only going to assume the liability of knowledge about a product, if I know what it is I am accepting liability for, which in my opinion, completely undermines NDAs.
If you find something evil that wobbles, push it. - Gary North
liberty student: You can't know that. I don't suspect people buy coke because it's taste has not been replicated, but rather because it has massive brand power and is part of a global distribution chain rivalled only by Pepsi. Does Pepsi have a secret formula? What is their relative market share over the last 10 years?
You don't think people buy Coke because of how it tastes? Remember the whole Old Coke and New Coke debacle of the early 80's. How about all the commercials related to taste tests? And yes we do know what Coke spends for various things as their records are public so we can have a very good idea of what the costs of maintaining security at Coke are versus their overall cost structure.
liberty student: Correct, but that determination is not made only by the person with the secret, but the person who would potentially be exposed to the secret under some form of agreement. Value is set by two parties in exchange, not arbitrarily by one party.
And what we know right now, without governement intervention, people make these agreements all of the time. Please explain why that will stop?
Once again, your theory and Kinsella's does not explain what people are doing right now or why without any change they would stop signing NDA's.
Maxliberty:You don't think people buy Coke because of how it tastes?
Pepsi.
Maxliberty:How about all the commercials related to taste tests?
How about them? That's a classic marketing trick. Sell people on consensus. It's not actually proof of anything.
Maxliberty:And yes we do know what Coke spends for various things as their records are public so we can have a very good idea of what the costs of maintaining security at Coke are versus their overall cost structure.
Do you actually know those costs? I'm not trying to discredit you, but you're making a claim I feel very confident you can't actually back up.
Maxliberty:And what we know right now, without governement intervention, people make these agreements all of the time.
I wasn't aware that there were private courts and private law. Could you tell me where private law exists?
Maxliberty:Please explain why that will stop?
I've already explained that, we can't know that it will stop or continue, because that would assume perfect knowledge. But we can reason that without state monopoly restrictions on private contracts, we could see completely new forms of contract neither you or I can imagine.
Maxliberty:Once again, your theory and Kinsella's does not explain what people are doing right now or why without any change they would stop signing NDA's.
If you cannot imagine that mechanisms will be difference under private law, than under state monopoly law, then I'm out of ideas to express it. I think you keep insisting that the mechanisms will be the same without coercion as they are with, that gap in opinion is the reason why this discussion continues to go around in circles.
liberty student: Maxliberty:You don't think people buy Coke because of how it tastes? Pepsi.
Right, taste matters ....ie the formula matters. People like Coke because of how it tastes.
liberty student: How about them? That's a classic marketing trick. Sell people on consensus. It's not actually proof of anything.
Yes, your right...how food actually tastes has no relevance for why people eat or drink it. Do I really have to prove to you that how food tastes is relevant to whether or not people eat it or not?
liberty student: I've already explained that, we can't know that it will stop or continue, because that would assume perfect knowledge. But we can reason that without state monopoly restrictions on private contracts, we could see completely new forms of contract neither you or I can imagine.
Of course this argues in favor of me and not you. Your belief that people only make contracts now as a result of some phantom state monopoly is just factually incorrect. Do you really think that people sign NDA agreements because there is a "state monopoly" on the law? Your in fantasy land.
liberty student:If you cannot imagine that mechanisms will be difference under private law, than under state monopoly law, then I'm out of ideas to express it. I think you keep insisting that the mechanisms will be the same without coercion as they are with, that gap in opinion is the reason why this discussion continues to go around in circles.
Why we go around in circles is that you do not want to acknowledge what people are doing right now. In your mythical anarchy won't it be the same people that we have right now? Why would their current voluntary actions not related to the state change?
Finally, your idea that we can have a world without any coercion is just nonsense and would only take one person on the entire planet aggressing against one other person to destroy it. Do you see the impossibility of your mythical anarchy?
Maxliberty:Right, taste matters ....ie the formula matters. People like Coke because of how it tastes.
You didn't answer my question about Pepsi and market share.
Maxliberty:Yes, your right...how food actually tastes has no relevance for why people eat or drink it. Do I really have to prove to you that how food tastes is relevant to whether or not people eat it or not?
I didn't realize you were making a point about taste. I thought you were making a point about phoney taste testing. Obviously, no two people taste things the same, or value tastes the same (praxeology 101) so I don't see how taste has anything to do with a NDA.
Maxliberty:Your belief that people only make contracts now as a result of some phantom state monopoly is just factually incorrect.
It would be factually incorrect if that was my opinion. However, it is a strawman you have constructed.
Maxliberty:Do you really think that people sign NDA agreements because there is a "state monopoly" on the law?
No, and I don't recall positing that. Sounds like another strawman.
Maxliberty:Why we go around in circles is that you do not want to acknowledge what people are doing right now.
I'm acknowledging it. However, I don't think it makes your case.
Maxliberty:In your mythical anarchy won't it be the same people that we have right now? Why would their current voluntary actions not related to the state change?
First, you need to stop misusing the term anarchy. Your last post to Nitro makes clear you don't have any understanding of the political philosophy of anarchy. Second, whether or not we have the same people was never the debate. What will change are the incentives. Again, praxeology.
That is, unless you think incentives make no difference. That is, man is not a rational actor, but pursues some sort of determinism, and cannot break from a pattern, regardless of the circumstances.
Maxliberty:Finally, your idea that we can have a world without any coercion is just nonsense and would only take one person on the entire planet aggressing against one other person to destroy it.
Well, that's not my idea. It is your assertion of a false position. You've yet to show that anyone actually believes it.
You're not really interested in furthering knowledge, you're only interested in arguing. And I am merely using you as a vehicle to communicate to the people who will read this discussion in the future. Just so we're clear.
Maxliberty:Do you see the impossibility of your mythical anarchy?
It's your mythical anarchy. Not mine.
liberty student: You didn't answer my question about Pepsi and market share.
I don't see a question about Pepsi and market share.
Would you agree that to copy is generally cheaper than to create the original in the first place?
if the above is true and you have a means to increase the costs of copying in order to discourage it and you determine that this is +EV for you then we would expect people to pursue that course of action.
Creating barriers to entry via NDA's can be a successful business tool. We have demonstrated cases that prove it. At the very least we have demonstrated cases that prove human beings believe the above and will pursue those actions. So you will just have to deal with it even if you think it doesn't do anything.
liberty student: First, you need to stop misusing the term anarchy. Your last post to Nitro makes clear you don't have any understanding of the political philosophy of anarchy. Second, whether or not we have the same people was never the debate. What will change are the incentives. Again, praxeology. That is, unless you think incentives make no difference. That is, man is not a rational actor, but pursues some sort of determinism, and cannot break from a pattern, regardless of the circumstances.
Man is a rational actor and he created the state. The state is just one group of coercive actors is all. Nothing more nothing less. Your anarchy can not eliminate coercive actors so its impossible. Accept it....this is anarchy. What you and I really want is less coercion in our current society. So eliminating the state is a good start.
Anarchy has to be viewed in degrees not a final destination. The elimination of the state does not equal anarchy.
Maxliberty:Creating barriers to entry via NDA's can be a successful business tool.
All depends on how you define success. If your competitors can compete without NDAs, then it may well be a millstone.
Maxliberty:We have demonstrated cases that prove it.
Not in a free market.
Maxliberty:At the very least we have demonstrated cases that prove human beings believe the above and will pursue those actions. So you will just have to deal with it even if you think it doesn't do anything.
No, they will have to deal with it. In the free market, costs can't be offloaded to third parties.
Maxliberty:Man is a rational actor and he created the state.
The latter portion is incorrect. Some men created the state. Not all men. You use collective fallacy with your NDA argument as well.
Maxliberty:The state is just one group of coercive actors is all. Nothing more nothing less.
We agree.
Maxliberty:Your anarchy can not eliminate coercive actors so its impossible.
Your conception of anarchy, this is true. However, that is not my conception of anarchy. It is simply a strawman argument.
Maxliberty:What you and I really want is less coercion in our current society. So eliminating the state is a good start.
We can agree on this.
Maxliberty:Anarchy has to be viewed in degrees not a final destination. The elimination of the state does not equal anarchy.
Again, this depends on the definition of anarchy. Instead of asking me what the definition of anarchy is, you have told me what my definition is. And thus far, you have been incorrect.
Maxliberty:Would you agree that to copy is generally cheaper than to create the original in the first place?
We say generally, because there are exceptions. Scarcity of raw materials, skills or capital goods are certainly variables we aren't accounting for.
Maxliberty:if the above is true and you have a means to increase the costs of copying in order to discourage it and you determine that this is +EV for you then we would expect people to pursue that course of action.
Your cost to deter copying can't be more expensive than costs of creation or someone will create rival products. This is why Coke may have a secret, but also dozens if not hundreds of competing cola brands to contend with.
And as always, you're assuming that you get 100% success with copying deterrence. Even one failure, and a copy is in the wild, and there is no guaranteed way to deter non-contracted third parties from copying with their own property.
liberty student: Maxliberty:We have demonstrated cases that prove it. Not in a free market.
That's just an evasion. The fact that the current market isn't free doesn't imply that we can't cite successful business models as having various legal advantages. Now, the fact of the matter is that we can't simply say that certain arrangements will or won't work, a priori, but I don't think that there is any problem with NDAs. In fact, I'm also tempted to say that current IP arrangements would put NDAs at a comparative disadvantage.
"You don't need a weatherman to know which way the wind blows"
Bob Dylan
GilesStratton:The fact that the current market isn't free doesn't imply that we can't cite successful business models as having various legal advantages.
Did I say we couldn't?
If you're going to interject into my discussions with others, then please be precise in your criticisms. Strawmen do nothing to advance the discussion. They only serve to draw attention to the people making them.
And before you write the now familiar, "not explicitly", I want to reiterate, that I am happy to make my positions explicit anytime you think there may be potential for misunderstanding, which based on your recent post history, would be nearly every response you make. Make worthwhile arguments, instead of dishonest accusations like,
GilesStratton:That's just an evasion.
Thanks.
GilesStratton:Now, the fact of the matter is that we can't simply say that certain arrangements will or won't work, a priori
Good luck trying to make that point to Max.
Maxliberty:You don't think people buy Coke because of how it tastes? Remember the whole Old Coke and New Coke debacle of the early 80's. How about all the commercials related to taste tests? And yes we do know what Coke spends for various things as their records are public so we can have a very good idea of what the costs of maintaining security at Coke are versus their overall cost structure.
Actually, the Old Coke - New Coke "debacle" of the early 80's demonstrates clearly that image, not taste, is most important, despite Sprite's (Coke's) recent campaign that Image in nothing. Before announcing New Coke, the company did blind taste test after blind taste test. The results were always the same - New Coke consistently beat Old Coke and Pepsi. However, the idea of changing the formula (certainly not the first change, by the way) caused a backlash against the company in the following years. Even though all market research showed that New Coke tasted better, by a very large margin, no less, consumers preferred the image of the classic formula.
Maxliberty: And what we know right now, without governement intervention, people make these agreements all of the time. Please explain why that will stop? Once again, your theory and Kinsella's does not explain what people are doing right now or why without any change they would stop signing NDA's.
I've pretty much agreed with most of your points in this thread. Even Mr. Kinsella agreed with some. What I think you're ignoring is the fact that trade secrets is a tiny portion of IP overall. I agree that trade secrets in a free market would probably be the same or very similar to how they are now. What would not be the same will be the larger parts of IP - copyright, trademark and patent.
liberty student: Maxliberty:The cost of keeping the Coke formula secret is not a meaningful factor in the price of a can of Coke. You can't know that. I don't suspect people buy coke because it's taste has not been replicated, but rather because it has massive brand power and is part of a global distribution chain rivalled only by Pepsi. Does Pepsi have a secret formula? What is their relative market share over the last 10 years?
The cost of keeping the Coke formula secret is part of the production cost. The price of a can of Coke is determined by consumers. You're not buying into the labor theory of value, are you?
As an aside, does Pepsi really have a larger distribution chain? Coke dominates them in sales.
JackCuyler:The cost of keeping the Coke formula secret is part of the production cost. The price of a can of Coke is determined by consumers. You're not buying into the labor theory of value, are you?
No, I am buying into the theory of continual losses lead to bankruptcy.
JackCuyler:As an aside, does Pepsi really have a larger distribution chain? Coke dominates them in sales.
When I wrote, "rivalled by" I did not mean to imply Pepsi had a larger distribution infrastructure, but that Pepsi is the (only?) competitor with a global distribution network.
liberty student: JackCuyler:You're not buying into the labor theory of value, are you? No, I am buying into the theory of continual losses lead to bankruptcy.
JackCuyler:You're not buying into the labor theory of value, are you?
Then it follows, seeing as how Coke is not bankrupt, that the various prices of Coke products are sufficient to cover the costs involved in protecting their secret formula.
JackCuyler:Then it follows, seeing as how Coke is not bankrupt, that the various prices of Coke products are sufficient to cover the costs involved in protecting their secret formula.
I don't recall stating otherwise.
My point to Max, was that he cannot know that the cost does not influence the price, that is to say, how much individual consumers of Coke value the secrecy of its formula or not. I wasn't trying to make an argument about how the cost raises the price, but that he cannot prove that the cost of secrecy adds value to the product from the consumer perspective.
liberty student:My point to Max, was that he cannot know that the cost does not influence the price, that is to say, how much individual consumers of Coke value the secrecy of its formula or not. I wasn't trying to make an argument about how the cost raises the price, but that he cannot prove that the cost of secrecy adds value to the product from the consumer perspective.
Ahh. I completely misunderstood you. You make perfect sense now. Carry on, then.
JackCuyler: liberty student:My point to Max, was that he cannot know that the cost does not influence the price, that is to say, how much individual consumers of Coke value the secrecy of its formula or not. I wasn't trying to make an argument about how the cost raises the price, but that he cannot prove that the cost of secrecy adds value to the product from the consumer perspective. Ahh. I completely misunderstood you. You make perfect sense now. Carry on, then.
Thanks. You had me questioning myself, because I do say stupid things sometimes.
I think this was just a case of not being clear.
This does of course raise the point, that without being able to determine the value of the secrecy to the consumer, puts in question the purpose of the secrecy. Like you, I think a case can be made for Coke's capitalization, scale and brand power, as opposed to the cachet attached to a secret formula, or a particularly desirable taste. When I was a pop guy, I drank Diet Pepsi or RC.
liberty student:This does of course raise the point, that without being able to determine the value of the secrecy to the consumer, puts in question the purpose of the secrecy. Like you, I think a case can be made for Coke's capitalization, scale and brand power, as opposed to the cachet attached to a secret formula, or a particularly desirable taste. When I was a pop guy, I drank Diet Pepsi or RC.
I would think that having a secret recipe adds to the brand power - a bit of mystique - you can only get this taste with us. Coke doesn't play it up so much these days, nor does McDonalds (secret sauce), but KFC certainly does, and that baked beans company with the the talking dog. I'm sure there are many others.
liberty student:Philosophically, we're not far apart on IP, you just have a very narrow view on it.
I really wish Max would see this. He's not so far off Kinsella, either. He's focusing one of the four major bits of IP, trade secrets. Currently, trade secrets are protected by contract and don't affect third parties anyway, so I doubt anything would be different in a truly free market. He's ignoring the rest of IP though, which would certainly be vastly different. Copyright and patent would be almost certainly non-existent. Trademarks, using another's brand name or possibly logos and slogans, hopefully would be considered fraud.
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