Masur on Merges on Masur on Mergers

I greatly appreciate Rob Merges' generosity in taking the time to respond to my original post.  His response is, characteristically for Rob, incisive and thoughtful.  I am not sure, in the end, how much we really disagree.  But I will take a shot at briefly disentangling and clarifying a few points with the goal of identifying whether or not disagreement actually exists.

Rob is absolutely correct that there are two separate questions: 1) whether an IP system can be justified at all; and 2) how well a particular system is performing.  Rob argues that, with respect to question #1, the IP system cannot be justified on economic (by which we mean utilitarian or welfarist) grounds.  Why would this be?  One possibility is that utilitarianism or welfarism or consequentialism (which is what we mean when we talk about an "economic" foundation) cannot provide a morally satisfactory basis for intellectual property rights.  There is a short section in the book (pages 151-153) that coulud be read as developing this argument, but that section is better understood as a critique of a completely unfettered free market, a point with which few economists would disagree.  As a general matter, the book does not appear to be making this point, and indeed it would be a mammoth undertaking to do so (even for Rob Merges and this book) given the extensive arguments that scholars have been making for centuries about welfarism as a moral foundation.  Rob will correct me if I am wrong, but I do not understand this to be his main argument.

A second possibility is that economics (read: utilitarianism or welfarism) cannot generate the midlevel principles that operate in intellectual property.  But as I pointed out in my previous post, it can generate them -- or at least the ones that are really central to the American IP system.

The third possibility, and the one I understand Rob to be advancing, is that the IP system, as it is currently constituted, does not actually promote the utilitarian ends that an economic approach would demand.  That is: as an empirical matter, IP doctrines as they operate today do not actually increase social welfare.  As Rob wrote in his post:

"The data required by a comprehensive utilitarian perspective are simply not in evidence in this field -- at least not yet. Put simply, I do not think we can say with the requisite degree of certainty that IP systems create net positive social welfare."

That seems exactly right to me, and this is why I believe that Rob and I are actually in violent agreement as to most of the important issues.  But this means that economics fails in response to Rob's question #2 -- how well is the system actually performing? -- rather than question #1, which is how the IP system can be justified on a theoretical basis.  That is why I wrote that economics has failed an empirical test, while Rob's deontic theory has passed a theoretical test.  This touches upon an excellent point made by a commenter to my first post.  This is not a reason to abandon deontic theory; rather, the point is simply that when we evaluate different types of theories, we should do on comparable grounds.

Nor do I mean at all to say that Rob's deontic theory is not correct, or compelling, or even superior to economics.  It is certainly the first two and maybe the third as well.  It is just that I do not believe a utilitarian economic theory can be ruled out on the theoretical grounds used to evaluate Lockean and Kantian deontic theories.  Economics is part of the overlapping consensus as well.