Congestion externalities and extended copyright protection

Dennis S. Karjala

Research output: Contribution to journalReview articlepeer-review

17 Scopus citations


Intellectual property is not vulnerable to the tragedy of the commons and, because the marginal cost of reproducing works of intellectual property already created is usually low, giving no protection at all would maximize economic utility. Traditional microeconomics analysis based on the public goods nature of intellectual property, especially nonrivalrous consumption, thus leads to the conclusion that it is economically inefficient to protect works beyond what is required as an incentive for their creation. Professor William Landes and Judge Richard Posner have recently challenged this analysis as part of a more general argument for an indefinitely renewable copyright. These authors posit "congestion externalities" as a potential cause for diminution in value of a popular work that is no longer protected under copyright. The idea is that, after too much unrestrained use, the demand curve for use of the work may shift downward, reducing much of the consumer surplus that would otherwise result from entrance of the work into the public domain. In some cases, they argue, society will incur a net loss from allowing the work to reach public domain status. Other authors have echoed this concern. While conceding the virtues of a copyright system requiring formal copyright renewal from time to time, this Essay argues that the Landes and Posner analysis on congestion externalities is incorrect. It is particularly inapt for copyright rights relating to digital technologies. The functionality of computer software may be superseded by technological advances but not by "overexposure." Other works, such as digital databases, maps, and factual compilations, also seem invulnerable to congestion externalities from unrestrained use. The Landes and Posner congestion-externalities analysis, however, is flawed in more fundamental ways. The analysis treats demand curves representing current social preferences as indicators of a sort of "inherent value." In fact, a downward shift in the demand curve for a product does not necessarily, or even often, represent a loss in "value" to society as opposed to a change in overall social preferences. Moreover, even if their value analysis were correct, Landes and Posner present no empirical evidence that demand curves for works of authorship will shift sufficiently after entering the public domain to create a net social loss in value. This Essay argues, by reference to existing public domain and copyright-protected works, that dramatic, long-term downward shifts in the demand curves due to entrance into the public domain are implausible. It argues further that even if such shifts do occur, meaning that few would be willing to pay for use of the work after its overexposure (were payment somehow to be required), public domain works remain of fundamental value to society as a whole as cultural and intellectual symbolic references. This value is not fully, if at all, captured in the economic analysis.

Original languageEnglish (US)
Pages (from-to)1065-1086
Number of pages22
JournalGeorgetown Law Journal
Issue number4
StatePublished - Apr 1 2006

ASJC Scopus subject areas

  • Law


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