THEORIES OF INTELLECTUAL PROPERTY RIGHTS
WHAT IS INTELLECTUAL PROPERTY?
o Intellectual property is a broad set of Intangible assets that are owned by a company
or individual. It is legally protected from outside use or implementation without consent.
An intangible asset is a non-physical asset.
o The concept of intellectual property relates to the fact and it is entitled to be protected
with the view that certain products of human intellect should be afforded the same
protective rights that apply to physical property, called Tangible assets.
o Intellectual property being intangible needs to be protected by law in the same sense as
corporeal property and therefore, copyright, patent, trademark, trade secrets are some
mechanisms under intellectual property rights (IPR) that protect novel innovation from
being imitated without permission.
o Intellectual property has unique characteristics compared to other forms of traditional
property. Hence the existing body of law governing such traditional property is not
appropriate for governing the ownership, transfer and utilization of Intellectual property.
“Intellectual property rights refer to the general term for the
assignment of property rights through patents, copyrights and
trademarks etc. for a limited period of time.”
o According to World Intellectual Property Organization,-“Intellectual Property (IP)
refers to creations of the mind, such as inventions; literary and artistic works; designs;
and symbols, names and images used in commerce”.
o Internet use has widely exposed Intellectual Property to multiple risks since it offers
"easy access to illegitimate copying and reproducing." IPR is crucial
for protecting original ideas and technical creations from being copied or misused, which
in turn promotes creativity and innovation.
o It is IP that serves as a motivator for creators by giving them a sense of ownership by
ensuring their information is protected even when it is accessed online. In today’s
technologically advanced age, it is crucial to protect innovations and works, therefore
IPR helps protect these.
Several important philosophers contributed toward a greater understanding of
intellectual property, including John Locke, Immanuel Kant, John Stuart Mill, Jeremy
Bentham, and Georg Hegel. The jurisprudential aspect of intellectual property rights is
based on their ideologies and theories.
The theories that this article encompasses are:-
1. The Natural Rights Theory - on the basis of John Locke’s idea.
2. The Utilitarian Theory based upon the Benthamite ideal of “the greatest good for the greatest number.”
3. The Deterrence Theory supports Morality.
4. The Ethics and Reward Theory promotes the ethical and moral aspect of intellectual property rights.
5. The Personhood Theory, which was propounded by Kant and Hegel.
1.The Natural Rights Theory
moral desert theory / labour theory.
The term “Natural Right” signifies a Fundamental right that a person has in his
possession. The natural rights theory takes into consideration that everyone has a natural
property right on his, or her ideas. This is because creation is the result of both labour, and
creativity of the person putting it into effect.
This theory is based on famous philosopher John Locke’s idea that - An owner possesses
a natural right over the things that he produces with the help of his own labor and
efforts, either physical or intellectual.
Thus, the Natural rights theory is applicable on both tangible and intangible properties.
Once the person acquires the property right, his original creation is protected from being
used, transferred or manipulated by another person. Any such breach of the intellectual
property right of the creator / owner would be against the law.
As ownership over a creation becomes a natural right of the owner, Breach / Infringement,
or unauthorized use of the intellectual property right will be considered as an offence.
The main justification behind this theory is that everyone has a right to consider his / her
ideas as natural property right by the reason that the creation originates from the effort,
originality and inventiveness of the creator.
In this sense, there is no difference between intellectual property and the traditional
tangible property and there is no difference between the rights of the owners of these two
kinds of properties.
Key Ideas of the Labour Theory:
1. Labour as the Basis of Property: Locke believed that nature is a shared resource, but these
resources need labour to be put to one’s use and individuals can make these resources their own
through their work. By applying labour to common goods, a person creates private property that
they have the right to control. Locke believed that “Individuals are entitled to control the
fruits of their own labor. In his perspective, a person, who cultivates crops by using his
own labor or creates a new invention by putting his efforts, naturally obtains property
rights, merely by the virtue of adding his own labor.”
2. Exclusive Right to Creation: When an inventor works on a creation with their own labour and
intellect, they earn an exclusive right to their invention. This right is a natural property right
that the state must respect and protect.
Therefore, ownership arises from the labor and innovation of person creating it.
3. The Role of Labour in Creating Value: Locke argued that goods in their natural state cannot
be enjoyed. People must put in labour to transform those goods into private property, which can
then be used and enjoyed. The labour adds value to these goods.
4. Moral Justification: According to Tom Palmer, the labour theory is also known as the Moral
Desert Theory because it is based on the idea that creators are entitled to the fruits of their
labour. If someone works to create something, they deserve to own and control it.
5. Incentive for Innovation: By protecting the creator's rights, the theory encourages innovation
and creativity. Inventors are motivated to continue producing because they know their labour
will be rewarded.
6. Limited Time and Balance: The creator has exclusive rights to their work for a limited time.
However, these rights should not harm the rights of others, and the inventor’s control should not
be unlimited.
Principles of the Labour Theory:
Nature as a Shared Resource: Nature belongs to everyone, but individuals can claim
ownership of what they work on.
Creation of Private Property: Through labour, a person converts common resources into
private property.
Incentives for Creators: The theory supports offering recognition and protection to
creators, motivating them to keep innovating.
Personal Connection: The theory emphasizes that the relationship between the creator and
their creation is personal, as the creator applies their own labour and intellect.
Control Over Work: The creator has control over their work, including modifications and
further use.
Limitations of the Labour Theory:
1. Labour Alone Isn't Enough: The theory assumes that labour alone justifies ownership, but
it doesn't account for other factors that may also contribute to the value of an intellectual
property.
2. Lack of Clarity on Labour: The theory doesn’t explain what constitutes "intellectual
labour" or how to measure the exact effort of the creator. There is no clear standard for
determining how much labour justifies ownership.
3. General Application: The theory has limited applicability. Different types of intellectual
property (e.g., patents, copyrights) may require different levels of labour, but the theory
doesn’t provide detailed guidance for all situations.
4. Raw Materials: The theory doesn't address the availability of raw materials or resources that
might be necessary for creating intellectual property. It overlooks the fact that the creator
may rely on shared resources to make their invention.
5. Lack of Proportionality: The theory doesn’t clarify how much right a creator has in relation
to the work they produce. For example, how much control does the creator have over
derivative works or modifications?
6. Returns or Incentives: The theory explains that creators should have rights over their labour,
but it doesn’t provide clear guidelines on how creators should be rewarded or incentivized for
their efforts.
2.The social planning Theory
The Social Planning Theory of intellectual property, propounded by Fisher, focuses on
balancing the interests of creators and the public to promote a just and vibrant intellectual
culture. It emphasizes that intellectual property (IP) rights should benefit society as a whole and
support cultural and creative development.
Key Points of Social Planning Theory:
Consumer Welfare: IP should balance incentives for creators with the need for others to
use and access creations.
Access to Information: Everyone should have access to information, promoting a free
flow of ideas and creativity.
Cultural Growth: IP should foster a rich tradition of arts and creativity.
Freedom and Respect: Individuals should be free to participate in cultural activities and
should respect themselves and others.
Community Welfare: The primary goal of IP is to serve the welfare and interests of the
broader community, not just private property rights.
Limitations of the Social Planning Theory:
1. Non-Practical: The theory is difficult to apply in practice, as many inventions are profit-
driven, not aimed at cultural development.
2. Overemphasis on Social Welfare: The theory places community welfare above private
property rights, which may not always align with the interests of creators.
3. Access Issues: It's unrealistic to guarantee access to all types of information, given
various barriers (e.g., cost, technology, restrictions).
4. Limited Balance: It’s hard to always balance incentives for creativity with the actual use
and utility of the creations by consumers.
3.The economic incentive benefit theory
The Economic Incentive Benefit Theory emphasizes that legal protection of intellectual
property (IP) is crucial to encourage inventors and creators. By granting IP rights, society
incentivizes innovation and creativity, ensuring that inventors can benefit economically from
their work, which in turn drives economic growth.
Key Points:
Encouraging Innovation: Protecting IP rights gives creators the incentive to continue
inventing and creating, as they can profit from their work.
Economic Growth: By protecting IP, inventors contribute to creating intellectual capital,
which boosts industries and helps the economy grow.
Phases of Benefit: First, the inventor enjoys economic rewards. Second, industries use
these innovations to develop, which benefits society.
Free Market Support: The theory is supported by advocates of free-market economics,
assuming that inventors seek profit maximization.
Resource Allocation: The main goal of this theory is to efficiently allocate economic
resources through IP protection.
Limitations:
1. Time-Consuming: Creating IP can take a long time, making it a slow process.
2. Original Work Requirement: The theory applies only to original inventions or works,
not to copies or minor adaptations.
3. High Initial Costs: Creating IP requires significant financial investment upfront.
4. Easy Reproduction: Once an IP is created, it can be easily copied, weakening the
protection's effectiveness.
5. Unclear Boundaries: It’s difficult to determine how much of the work can be copied
without reducing its original value.
4.The UTILITARIAN theory
Overview: The utilitarian theory of intellectual property rights (IPR) is based on the idea that
the purpose of IPR is to maximize the overall well-being or happiness of society. It is rooted in
the philosophy of John Stuart Mill, who argued that actions should be taken if they produce
the greatest happiness for the greatest number of people while minimizing harm or pain.
Key Points of the Utilitarian Theory in IPR:
1. Maximizing Happiness and Minimizing Harm:
o According to Mill's utilitarianism, IPR should maximize public benefit by encouraging
creativity and innovation. If granting intellectual property rights (IPR) leads to a
greater overall benefit (such as new inventions, artistic works, or technological
advancements), then it is justified.
2. Incentive for Innovation:
o IPR encourages innovation by providing exclusive rights to creators, allowing them to
benefit financially from their work. This exclusivity serves as an incentive for creators
to publicly disclose their inventions or works, knowing they will have protection from
unauthorized use. By promoting the sharing of knowledge, society benefits from
greater access to innovations and creations.
3. Patent System:
o Mill supported the patent system because it allows inventors to hold a temporary
monopoly on their creations, which incentivizes them to disclose their inventions
openly. This contrasts with the older system of royal monopolies, where rewards
were often arbitrary and not based on the merit of the innovation.
o Benefit to society: The patent system encourages inventors to share their
knowledge, which benefits society by making new technologies available to others
once the patent expires. This balance between protecting the inventor’s rights and
disseminating knowledge is seen as an example of utilitarian thinking in action.
4. Trademark Protection:
o Utilitarianism justifies trademark law by emphasizing the benefit of protecting marks
that consumers associate with certain qualities or origins. If trademarks are not
protected, businesses and consumers both suffer:
Businesses: Risk of being harmed by "passing off" where others use the same
mark to deceive customers.
Consumers: Face increased search costs and confusion, and are vulnerable to
purchasing counterfeit goods that do not meet the expected quality standards.
o Utilitarian Argument: Protecting trademarks reduces confusion and the time
consumers spend searching for products, thus maximizing overall well-being by
reducing harm and increasing consumer satisfaction.
5. Copyright Protection:
o Copyright protects creators (authors, composers, photographers, etc.) by ensuring
they have exclusive rights to their works for a limited period. This incentivizes the
creation of new works by allowing authors to earn revenue and control how their
work is used.
o Benefit to society: By granting temporary monopoly rights, authors are more likely
to create and share their works, enriching public culture and knowledge. The
utilitarian view here is that the short-term monopoly on works leads to a long-term
benefit as more creative works are available for public consumption and
appreciation.
Criticisms of the Utilitarian Justification for IPR:
1. Imbalance Between Private and Public Interests:
o One of the main criticisms of utilitarianism in IPR is that it often fails to balance private
property rights with the broader public interest.
o IPR grants exclusive rights to creators, but these rights can also restrict access to
knowledge or cultural works, limiting their potential benefit to society.
o For example, long-duration copyrights or patent monopolies might prevent others from
using certain innovations, which can limit creativity, innovation, and access to
knowledge.
2. Over-Protection and Harm to Public Access:
o Critics argue that IPR, when granted without careful consideration of its impact on public
welfare, can lead to over-protection, where the duration or scope of rights is excessive.
This can restrict access to vital information, such as life-saving drugs or educational
materials, especially when the public interest should take precedence over private profits.
3. Access to Knowledge:
o In the case of scientific research, for example, patents may restrict access to key findings
or technologies, preventing others from building upon them. This can slow down
scientific progress and hinder the public good.
4. Short-Term vs. Long-Term Benefit:
o While utilitarian theory promotes short-term economic incentives for creators, critics
argue that it often overlooks the long-term consequences for society, such as
monopolistic behavior, stifling competition, and making essential innovations inaccessible
to people who need them most.
Key Criticisms of the Patent System:
1. Restriction on Free Use of Ideas:
o Patent rights grant exclusive ownership to the first person to register an idea, preventing
others from freely using it. While the patent system encourages innovation by rewarding
inventors, it also restricts others from using or improving upon the invention during the
patent's duration (usually 20 years).
o This creates a monopoly on the use of the idea, which can stifle further innovation and
delay the spread of knowledge that could benefit society.
2. Impediments to Knowledge Sharing:
o Even though patents require the inventor to disclose their invention, this exclusive
ownership still limits the free flow of knowledge. Downstream innovations—which
build upon existing ideas—may be hindered because others cannot freely use or improve
upon patented technologies without risking infringement.
o Example: If the wheel had been patented in ancient times, its progress and widespread use
could have been severely restricted. As a result, the development of many subsequent
inventions (vehicles, machinery, etc.) would have been delayed, impeding human
progress.
3. Monopoly Power:
o The patent system can create a monopoly by granting exclusive rights for a set period.
This monopoly power often allows the patent holder to control market prices for the
product or technology, which may limit public access to the innovation and reduce
competition.
o Impact on Society: While the patent holder benefits economically, society as a whole may
not. High prices or restricted access to essential technologies could mean that only a few
people (the patent holders) gain substantial benefits, while others lose out.
4. Negative Effect on Market Dynamics:
o The monopolistic nature of patents can harm the competitive market. When a single
entity controls an invention or product, it often eliminates competition, leading to higher
prices and potentially less innovation in the industry.
o This reduction in competition can limit consumer choice, as the monopolistic company
may not have the same incentive to improve or reduce prices compared to a competitive
marketplace.
