Economic and Social Justice Perspectives
Edited by Anne Flanagan and Maria Lillà Montagnani
Chapter 1: Intellectual Property, Social Justice and Economic Efficiency: Insights from Law and Economics
1. Intellectual property, social justice and economic efficiency: insights from law and economics* Giovanni B. Ramello INTRODUCTION 1. Property rights have been a powerful device for promoting trade development, market existence and efficiency throughout human history. What is not owned cannot be traded. Hence, a well-defined set of property rights is central to the existence of trade. In addition, commonly held resources cannot be divided without a specific set of rules assigning the various parts to individuals. Thus, the market as we define it today could not exist without property rights. On the other hand, a system of allocating goods that does not rely on market exchange – such as war, theft or gift – seems unable in most cases to achieve the attainment of maximum welfare through the allocation of a scarce resource to the one who most values it. Therefore, as confirmed by a long tradition of economic theory, a well-defined set of property rights can play a crucial role in promoting the efficient allocation of scarce resources and social welfare.1 Further, in Western culture private property has been the cornerstone of capitalist society, to the point of being considered to some extent the necessary condition for the freedom of its citizens and the existence of the market. It is hence an irrefutable component of individual liberty. These premises are quite inarguable, and the beneficial role of property rights should be duly acknowledged. * An earlier version of this chapter was published in Gosserie A., Marciano A. and Strowel A. (eds,...
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