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Intellectual Property and the Structure of Human Action

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There are various ways to explain what is wrong with IP. You can explain that IP requires a state, and legislation, which are both necessarily illegitimate. You can point out that there is no proof that IP increases innovation, much less adds “net value” to society. You can note that IP grants rights in non-scarce things, which rights are necessarily enforced by physical force, against physical, scarce things, thus supplanting already-existing rights in scarce resources. (See, e.g., my Against Intellectual Property, The Case Against IP: A Concise Guide” and other material here.)

Another way, I think, to see the error in treating information, ideas, patterns as ownable property is to consider IP in the context of the structure of human action. Mises explains in his wonderful book Ultimate Foundations of Economic Science that “To act means: to strive after ends, that is, to choose a goal and to resort to means in order to attain the goal sought.” Or, as Pat Tinsley and I noted in “Causation and Aggression,” “Action is an individual’s intentional intervention in the physical world, via certain selected means, with the purpose of attaining a state of affairs that is preferable to the conditions that would prevail in the absence of the action.”Obviously, the means selected must therefore be causally efficacious if the desired end is to be attained. Thus, as Mises observes, if there were no causality, men “could not contrive any means for the attainment of any ends”. Knowledge and information play a key role in action as well: it guides action. The actor is guided by his knowledge, information, and values when he selects his ends and his means. Bad information–say, reliance on a flawed physics hypothesis–leads to the selection of unsuitable means that do not attain the end sought; it leads to unsuccessful action, to loss. Or, as Mises puts it,

Action is purposive conduct. It is not simply behavior, but behavior begot by judgments of value, aiming at a definite end and guided by ideas concerning the suitability or unsuitability of definite means.

So. All action employs means; and all action is guided by knowledge and information. (See also Guido Hülsmann’s “Knowledge, Judgment, and the Use of Property,” p. 44.)

Causally efficacious means are real things in the world that help to change what would have been, to achieve the ends sought. Means are scarce resources. As Mises writes in Human Action, “Means are necessarily always limited, i.e., scarce with regard to the services for which man wants to use them.”

To have successful action, then, one must have knowledge about causal laws to know which means to employ, and one must have the ability to employ the means suitable for the goal sought. The scarce resources employed as means need to be owned by the actor, because by their nature as scarce resources only one person may use them. Notice, however, that this is not true of the ideas, knowledge and information that guides the choice of means. The actor need not “own” such information, since he can use this information even if thousands of other people also use this information to guide their own actions. As Professor Hoppe has observed, ” in order to have a thought you must have property rights over your body. That doesn’t imply that you own your thoughts. The thoughts can be used by anybody who is capable of understanding them.”

In other words, if some other person is using a given means, I am unable to use that means to accomplish my desired goal. But if some other person is also informed by the same ideas that I have, I am not hindered in acting. This is the reason why it makes no sense for there to be property rights in information.

Material progress is made over time in human society because information is not scarce and can be infinitely multiplied, learned, taught, and built on. The more patterns, recipes, causal laws that are known add to the stock of knowledge available to actors, and acts as a greater and greater wealth multiplier by allowing actors to engage in ever more efficient and productive action. (It is a good thing that ideas are infinitely reproducible, not a bad thing; there is no need to impose artificial scarcity on these things to make them more like scarce resources; see IP and Artificial Scarcity.) As I wrote in “Intellectual Property and Libertarianism“:

This is not to deny the importance of knowledge, or creation and innovation. Action, in addition to employing scarce owned means, may also be informed by technical knowledge of causal laws or other practical information. To be sure, creation is an important means of increasing wealth. As Hoppe has observed, “One can acquire and increase wealth either through homesteading, production and contractual exchange, or by expropriating and exploiting homesteaders, producers, or contractual exchangers. There are no other ways.” While production or creation may be a means of gaining “wealth,” it is not an independent source of ownership or rights. Production is not the creation of new matter; it is the transformation of things from one form to another — the transformation of things someone already owns, either the producer or someone else.

Granting property rights in scarce resources, but not in ideas, is precisely what is needed to permit successful action as well as societal progress and prosperity.

This analysis is a good example of the necessity of Austrian economics–in particular, praxeology–in legal and libertarian theorizing (as Tinsley and I also attempt to do in “Causation and Aggression“). To move forward, libertarian and legal theory must rest on a sound economic footing. We must supplant the confused “Law and Economics” movement with Law and Austrian Economics.

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