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SOME PUZZLING BEHAVIOR BY OWNERS OF INTELLECTUAL PRODUCTS: AN ANALYSIS
Author(s) -
LIEBOWITZ S. J.
Publication year - 1987
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/j.1465-7287.1987.tb00264.x
Subject(s) - web syndication , intellectual property , negotiation , regret , legislature , appeal , law and economics , business , renting , economics , advertising , public economics , law , political science , finance , venture capital , machine learning , computer science
Creators of intellectual properties frequently seem to prefer “rental,” or sale with restricted rights, over outright sale of the intellectual properties. Surprisingly, these individuals also seem to prefer legislative provisions forcing them to restrict purchasers' rights rather than allowing this result to be achieved through voluntary negotiations. In this paper, I examine two examples of this behavior: the sale of syndication rights for television programs and the separation of broadcast rights from synchronization rights for music in television broadcasts. The desire to restrict purchasers' rights is explained in two ways. First, I appeal to recent developments in utility theory, namely, regret theory. Second, I show that sales of intangible goods such as intellectual properties are less closely related to use than are sales of tangible goods, and that restricting rights is an attempt to enhance such a linkage. I give several explanations for using legislative solutions, although I acknowledge that further research is needed on both questions before definitive answers can be given.