Edited by Ruth Towse and Christian Handke
Chapter 19: Copyright and competition policy
Despite the tension that exists between the goals of competition law and copyright law (and other forms of intellectual property) the modern view is that ultimately these two areas of law share the same long-term goals of promoting innovation to enhance consumer welfare (Bohannan and Hovenkamp, 2011). We tolerate some static inefficiency that may result from granting exclusive rights in order to promote dynamic efficiency and long-term growth. As Frank Easterbrook, echoing Schumpeter (Schumpeter, 1994), put it, ëan antitrust policy that reduced prices by 5 percent today at the expense of reducing by 1 percent the annual rate at which innovation lowers the cost of production would be a calamity. In the long run a continuous rate of change, compounded, swamps static lossesí (Easterbrook, 1992: 119). The problem, of course, is that in formulating the optimal policies (optimal in the sense of second best) it is not clear how much static inefficiency we should tolerate in order to promote dynamic efficiency, and moreover, since todayís intellectual goods are inputs for those of tomorrow, there is no magic line that allows us to know whether when we sacrifice the static we promote the dynamic or, instead, we impede both. How the law handles this tension in the application of competition law to intellectual property has been the subject of extensive literature (for example, LÈvÍque and Shelanski, 2005; Boyer et al., 2009; Anderman and Ezrachi, 2011).
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