Intellectual Property Course - K54CLC

Questions for Discussion (Chapter 1)

1. Individual discussion:
Please watch the online lecture given by Prof. Fisher at:
https://www.youtube.com/watch?v=3ISstJYsCWs
and discuss the followings:

- From the perspective of the welfare theory, why do governments have to

intervene in the promotion of innovation?
- Please discuss the advantages and disadvantages of the innovation-promoting
remedies?
- As a remedy to promote innovation, what are the main characteristics of
intellectual property system?
- Why IP system is considered as a second-best solution?
- What are the main concerns when designing IP policies?

2. Group discussion
(please divided yourselves into for-group and against-groups of max 5
members)

Why do we need to purchase copyrighted software copies instead of hacked

copies?

ANSWERS
1. Individual
 Law in particular should be organized so as to induce pp to behave in
ways that redound to the benefit of the public at large by: creating
combinations off incentives and penalties to nudge pp in socially
beneficial directions.
 Creates rights that reward pp for what they conducted in the past.
 Focuses on the welfare of society as a whole rather than on doing justice
to the human needs of its individual members.
 A public good: non-rivalrous and nonexcludable.
 Why are pp less motivated to produce public goods:
+ high costs of creation
+ high uncertainty
+ low marginal cost of production
+ positive externalities from the public good
 How to migrate the problem?
+ lead time protects first mover
+ custom or extralegal first mover
+ opportunities for increasing excludability through self-help
+ alternative motivations for production: passion, prestige/fame, tenure,
norms of science, advertising, voluntary creation
+ philanthropy (lòng từ thiện)
 Possible solutions:
+ Government provides the goods
+ Government selects and subsidizes private innovators
+ Gvm issues prizes to successful private producers
+ Legal reinforcement of self-help strategies
+ Gvm protects producers against competition

- From the perspective of the welfare theory, governments have to

intervene in the promotion of production because this will support R&D
and innovation but market alone cannot provide adequate incentives for
production. If there is no intervention from the government, the society
will not be able to receive new innovations to improve higher living
standard or other needs of development.

Advantages
- Support R&D and give
motivation for new
innovations.
- Protect the creativity and the
monopoly of the product
invented.
- Avoid wasteful innovation
efforts.
- Help transfer technology.
Disadvantages
- Controversial between how
to balance the maximum
wealth for the community
and the benefit recouped to
the creators.
- The willingness of pp to pay
for goods, services is not
high. What is the proper
measure of welfare?
- An inventor may bear all cost
of an innovation but
everyone benefits.

- Characteristics:
+ Intangible property: it doesn’t cover the created physical object but
retains the conceptual development behind. It is also about the ability to
produce a new idea.
+ Rights: exclusive production, copying, market.
+ Under specific laws.
 + Territoriality: applied only within the relevant boundaries.

- Second-best solution:
+ Balance between incentives (dynamic gain) and access (static loss)
(to strike balance)

- Concerns:
+ How to enable the public to get access to the policies and raise their
awareness of following?
+ How to transfer the content clearly enough like explaining the purposes
of the policies?
+ Realistic, straightforward and reasonable.

2. Group
- Copyright owners have exclusive rights to reproduce and distribute their
works => illegal to duplicate or distribute software or documentation
without the owner’s permission.
- It is considered to be an action of stealing if you use without paying.
- Generate the habit of free-riding => unacceptable.