The myth of intellectual property rights

Thirteen million people died last year of curable diseases. Of these, three million children died from diseases that are preventable with currently available vaccines (see GAVI). This is 35,000 people every day – seven times as many deaths each day as died in the attack on the World Trade Centre on September 11, 2001.

The term “intellectual property rights” is (deliberately) misleading. As I explain in a longer article about intellectual property, intellectual property rights are not a natural property right like other property rights (eg for land) which improve the functioning of the market by moving it towards a socially optimal equilibrium. Instead they are an artificial government intervention which distort the market away from its equilibrium, by distorting the price of knowledge above the competitive outcome (ie marginal cost).

There are some good reasons for a government intervention of this sort – namely, that it encourages research and development and hence the increase in knowledge of society as a whole. But it comes with an economic cost, which is a market distortion that causes under-consumption of knowledge-based goods. The cost of this distortion is growing much faster than the benefit, because the knowledge content of goods and services is increasing. The impact includes the death of millions of people every year because they cannot access human knowledge, even though it would cost society nothing at all for them to do so.

There are alternative ways to solve the problem of under-investment in new knowledge which are less economically harmful than intellectual property rights. Governments around the world should consider using those other techniques instead of intellectual property rights.

See the full article here.

Published by Owen Barder

Owen is Senior Fellow and Director for Europe at the Center for Global Development and a Visiting Professor in Practice at the London School of Economics. Owen was a civil servant for a quarter of a century, working in Number 10, the Treasury and the Department for International Development. Owen hosts the Development Drums podcast, and is the author Running for Fitness, the book and website. Owen is on Twitter and

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1 Comment

  1. Owen – I quite agree about intellectual property rights. They’re not a right, but a licence to place restrictions. Aggressive insistence of IPR is very threatening to software innovation, artist & consumer-friendly distribution of films and music etc. Are you a Richard Stallman/Laurence Lssig fan?

    William Heath

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