Weak intellectual property and economic catch up – the German case

In Der Spiegel, Frank Thadeusz reviews Eckhard Höffner’s work. The story: 19th century Germany had far better dissemination of new scientific & technical ideas, in part because weak copyright enforcement forced publishers into aggressive pricing & paperback editions. In England publishers thrived but most people couldn’t afford their products. This difference helped Germany catch up.

What Höffner describes in 19th century Germany is a sort of open innovation system – not one without intellectual property protection, but one with weak protection. This is important because the question with IP protection should never be “yes or no?”, but “what kind and how strong?”. Höffner’s story has important implications both for how the interests of authors and artists are served by the IP system, and for the role of IP in economic development.

On the first point: elsewhere in Höffner’s work, we find this claim: weak copyright was better for authors than either strong copyright or no copyright. Weak copyright kept the publishers working hard & cutting prices & getting more works into print, and for most authors this was a big plus. The typical German academic author earned much more from royalties – relative to academic salary – than the typical British academic author, not despite but because of the weak enforcement of copyright in Germany. In the UK there were a few superstar authors who benefited from the stronger copyright system, but they were very few. We see the same thing going on now with both academic publishing (both research and textbook), and with intellectual property rights in the arts.

On economic development: Höffner’s story fits with other things we know about both copyright & patent protection in countries that are catching up, in any era: the limits to IP coverage are always important. When Britain first adopted patent protection in the 17th century, it didn’t protect foreigners; the omission was a feature, not a bug: it was used as a reward for bringing (stolen) technology from abroad. Post WWII Japan interpreted patents – its own, and others’ – very narrowly, which encouraged clever engineering work-arounds and a more competitive market. And how many products are copied, on an industrial scale, in China today?

That is how catch-up works. Efforts to impose broad, long-lasting, and strictly enforced IP on the whole world are just a way for the countries which are specializing in IP production – particularly the US and UK, also Sweden, France … – to make a living that way for a few decades.

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