Privilege, Peer Review, and Piracy: Q & A

Three recent posts produced several questions and comments.

Follow the Government Intervention. In “The Market Gives Privilege to No One” I stated that certain groups of professionals do not usually work weekends and that the computer industry’s “24/7” indicates the ultimate in free-market service. “But I work weekends,” protested one doctor and one professor and shock was expressed that I was asking them to work around the clock!

Concerning the latter, no one person that I know of in the computer industry works twenty-four hours a day, seven days a week. The designation “24/7” means that customers can get service whenever they need it; the 24/7 company covers the entire week, around the clock, with service workers. Educational services on Saturdays and Sundays are scarce. Medical services are nonexistent, unless you are willing to subject yourself to waiting six hours or more in a socialized hospital emergency room. Government intervention, especially restriction of the supply of doctors and hospitals in the medical market, creates these service distortions and gives the professors and doctors a privileged life. On the medical market, see "100 Years of Medical Robbery" and "Real Medical Freedom" by Dale Steinreich.

One professor recited a common view that some academics hold: students are not customers, but products to be sold to businesses, that is, students are “work in progress” that become “finished goods” upon graduation. At best, this description of students is metaphor, at worst it is profound insult. The product of education is the knowledge the professor is supposed to be conveying to students and knowledge is what students are buying with their tuition payments. If professors view students as products in a production line, is it any wonder that students feel like numbers on a roster? Why do professors view them this way? Follow the government intervention: because that is precisely how the bureaucracy views students.

Playing the Game. In “Drop Errors and the Trouble with Peer Review” I said that peer reviewers are gatekeepers that prevent or delay the acceptance of innovative ideas. One reader wrote that entrepreneurs are getting around the gatekeepers by establishing online journals.

True. Technological innovation, such as the Internet, has made it easier for writers to get into print without having to jump through the usual hoops and there has been a proliferation of academic journals, many of them online. Much of the proliferation, however, is driven by the publish-or-perish atmosphere of academic life, which is expanding beyond research universities to what used to be called teaching schools. Accreditation requirements for “academic qualification,” usually defined as a certain number of peer-reviewed journal articles—books don't count or, at most, count only as equivalent to one article—have created the need for more outlets to accommodate this increased “original research.”

University administrators have become bean counters and professors plan strategies for getting around the peer-review gatekeepers. Hallway discussion among faculty is about how to play the game.

Is Unauthorized Copying Theft? In “The Market Function of Piracy” I said that pirated goods may function as a free sample in accelerating the acceptance of new products. The question arises, am I defending theft? No, I’m trying to recast the intellectual property debate; I addressed the issue to some extent in a comment I made to my post on the Mises blog.

As Siva Vaidnyanathan said in Copyrights and Copywrongs, “You cannot argue for theft” (p. 253). Neither Vaidnyanathan nor Lawrence Lessig in Free Culture are against intellectual property but both are attempting to rein in the lunacy of recent trends, such as the war against peer-to-peer file sharing and the push for perpetuity in copyrights. Their focus is on reforming intellectual property law to foster creativity, not stifle it. Roll it back, perhaps, to fourteen or twenty-eight years for copyrights.

The problem I have with their discussions, and others, is that interest-group and collectivist terminology dominate. Beginning with the Constitution, the aim of patents and copyrights is “to promote the Progress of Science and Useful Arts.” Why not promote business in general? The aim of intellectual property legislation, they say, is to balance the needs of society with the rights of creators and the public good should dictate when property should go into the public domain. Etc.

When some advocates of intellectual property rights, on the other hand, make a case for the perpetuity, they have the collectivist and utilitarian defenders in a bind. Rights do not expire, they say. Why should my patent or copyright expire? Time limits are arbitrary, justified only on grounds of the public good. It is the failure to answer this argument, I think, that today is causing the continued lengthening of copyright, and to a lesser extent, patent terms.

The fundamental question to be answered in intellectual property debates is, where does your property end and my rights begin? How is it that you can come into my house and tell me that I cannot copy something I already paid you for? Or, to put it in historical context, is intellectual property really property or is it an instance of monopoly power and privilege? Historically, until the mid-nineteenth century, patents and copyrights were considered monopolies granted by the government; that’s why time limits were put on them. And many economists in the nineteenth century considered patents just another form of protectionism.

My knowledge of marketing theory adds an additional perspective to this debate. There are actions creators can take—mainly the relentless search for customers—to market their innovations without resort to patents and copyrights. Clothing designs, for example, are largely unprotected, but some designers, despite the rapid availability of knock-offs, do quite well. By initiating lawsuits, especially the kind that occur today, creators’ actions begin to look like monopoly protectionism cloaked in the self-righteous guise of property rights. Add to this the mind/body dichotomy—namely that creators do not like, and some even despise, having to aggressively market their wares—and you have a case for concluding that patents and copyrights are more about monopoly and less about property.

Property or monopoly. That is the issue. I’m not 100% certain that patents and copyrights are monopolies, but I’m no longer convinced that intellectual property is property. More research on my part must be done. I will have more to say about this topic at some other time.

Drop Errors and the Trouble with Peer Review

In product development there are two kinds of errors. A “go” error occurs when the green light is given to a product that eventually fails. The Edsel, a $250 million write-off by the Ford Motor Company in 1959, is one example. The “drop” error occurs when an idea that could have been highly profitable is eliminated from further consideration. How do we know that the idea could have been profitable? In a free market dropped ideas have the habit of being picked up by someone else. Chester Carlson’s invention was dropped by such notables as General Electric, 3M, Kodak, RCA, and IBM, but picked up by the small Haloid Company. In 1961 Haloid changed its name to Xerox. Even go errors in a free market often get corrected; just a few years after the Edsel fiasco, Ford rolled out a better idea called the Mustang.

Peer review is the process by which millions of dollars of government money are handed out to researchers in medicine and the physical sciences; the process by which recognition, promotion, and tenure are determined for professors, especially those in the “softer” sciences who do not need or use grants for their research; and one of the criteria—numbers of peer-reviewed journal articles, for example—used to determine accreditation for universities.

Peer review, a “blind” process in which the names of author and evaluator are concealed from each other, requires two or three so-called peers to read a paper or proposal to judge the quality of actual or proposed research before acceptance. As such, peer review is a product development process that protects only against go errors. It is at best quality control that insures accuracy and reliability of research done. At worst it holds back innovation through drop errors. Since there is no free market in scholarly research—today’s government-university-science complex is a severely hampered market—dropped ideas either never get a hearing or take many more years than they otherwise should to surface.

Medical researcher and long-time critic of peer review, David Horrobin, argued that the peer-review process, which developed in its current form largely as a screening device after World War II, has perhaps improved the accuracy and reliability of conventional research published in medicine, but it has done so at the price of innovation. Prior to World War II, unknown researchers could submit papers to journals only with the endorsement of a published author. The editor would then decide whether or not to publish. Peer review was ad hoc and not common. It was the growth of government involvement in education and, especially, the government’s lavishing of money on research that called for the blind-review screening process.

In a paper titled “The Philosophical Basis of Peer Review and the Suppression of Innovation” Horrobin urged that more unconventional and innovative research be encouraged by journal editors. When a reviewer questioned the need for such a statement, Horrobin produced eighteen incidences of medical innovations rejected by the peer-review process. In 1995 Horrobin’s paper was cited by the US Supreme Court as support for the argument that some “well-grounded but innovative theories” may not be published in peer-reviewed outlets.

Horrobin’s solution to divvying up grant money was to give funds equally to all researchers and let each work on whatever his or her interests indicated. Prior to 1960, said Horrobin, this interest-as-guide process was essentially how funding was distributed in the UK and more innovation in medicine resulted in those years than in the years since 1960. Horrobin approved of government involvement in and funding of research, but the analogy to free markets in his solution—bottom-up, self-interested choice by researchers—versus central planning—top-down, “expert” direction by peer reviewers—cannot be escaped.

Never mind that Socrates and Galileo were badly treated by their peer reviewers or that frauds and hoaxes sometimes dodge the quality controllers or, further, that you may want to cite Ayn Rand and Ludwig von Mises but can’t figure out how to get past your peer-review gatekeepers, the real problem of peer review is the severely hampered market in scholarly research. What would a truly free market in scholarly research be like?

First, publishers of journals and scholarly books would have to earn a profit from their buyers and not live off the donations of their authors or other benefactors. Some university presses, for example, are now publishing what are called “supported books,” which means someone, usually the author’s department, must contribute one or two thousand dollars to the publication of the author’s book. And at least one commercial press requires authors to do their own copy edit and provide camera-ready typeset text; this can add up to two thousand dollars or more that authors must fund. Twenty-five dollars per page, charged to authors or their departments, has long been the going rate for published papers in some fields. (In some quarters today this method of getting into print would be called subsidy or vanity publishing.)

In addition, the so-called nonprofits, which finance a portion of today’s research and journals, are in fact creatures of the tax system and must, despite their descriptive name, show an excess of donations over expenses lest their organization become some philanthropist’s very expensive hobby. Under laissez-faire, in the absence of tax write-offs and the guilt and ignorance of economics that wealthy business people tend to exhibit, there probably would be far fewer such organizations than exist today.

Second, there would be no government money to dangle in front of researchers and no government-owned or -regulated universities filled with bureaucratized product lines (curricula designed by committee), bureaucratized sales reps (the professors), or bureaucratized performance evaluations (those mounds of paper, which include lists of published research, that must be produced for promotion, tenure, and most every other consideration). All of this distorts the market and probably encourages the overabundance of pretentious minutia that fills today’s overabundance of academic journals.

Under laissez-faire, only the market would decide who produces what and who gets what in scholarly output. Indeed, the market for this research might not differ much from the product development market in automobiles. Private, profit-making firms, both traditional businesses and universities, would finance the work and effectively and efficiently produce market-satisfying results. Portions of the results might be published in profit-making journals and books, much of it perhaps not.

Yes, there might be some Edsels created by this free-market development process and there might still be some delayed acceptances of Xeroxes, but there also might be a lot more Mustangs! Absent the government-encouraged gatekeepers and other hurdles that must be jumped in order to get into the market, researchers who cannot find an outlet will be free to start their own journals, publishing companies, businesses, or even universities. The hampered market today, which includes the “golden handcuffs” of tenure, makes this quite difficult.


See related posts on the Mises blog: 1, 2.