Progressives?

Megan McArdle has a series of posts on how pharmaceutical price controls in Europe and Canada result in the development of fewer new drugs and how introducing similar policies in the US would reduce drug innovation to a mere fraction of what we have now (here, here, here, here, and here). Some takeaway points that aren't made clear in the original posts:

1. Leftism inhibits progress. "Progressive" is every bit as inappropriate a label for the left as is "liberal."

2. Leftism kills--even the softer, gentler, non-Stalinist variety. People are dying for want of drugs that weren't developed because the profits weren't there just as surely as they died for want of food that wasn't grown in Stalin's Russia and Mao's China.

3. European and Canadian governments are killing us (and their citizens) by enacting and maintaining price controls on pharmaceuticals in order to save a few bucks (in 2000, the US spent about $560 per capita on pharmaceuticals). This is despicable at best.

Share this

But how do you really feel

But how do you really feel about it?

Eh

I could take it or leave it.

Hum

I think the price of drugs is actually benefiting from government intervention through the patent system. When it comes to drug innovation, libertarians may face much harder problems.

Some may.  Many

Some may.  Many libertarians are not against intellectual property, however.

Many defend copyright but

Many defend copyright but fery few defend patents AFAIK, this is Rothbard and Rand's position for example. For what it's worth I oppose both.

Economic argument for patents iffy

There's the well-known defense, but there are also potential pitfalls with patents. It is not for nothing that patents are not forever. Even the defenders of patents understand that there is some number of years beyond which the claimed good effects of patents would be negated or reversed. But what is the actual number of years? Defenders of patents say twenty years, more or less. Why twenty? Why not ten? Five? Zero? Defenders of patents have already conceded the principle that patents cause harm after a certain number of years. They believe that that optimal number of years is some particular number above zero, something around twenty I think, but what is their reason for this? Do they have a really strong argument for this? To me it seems an arbitrary number. The only number between zero and infinity that is not arbitrary is zero itself, so the less arbitrary hypothesis, on the face of it, is that the optimum length of patent protection is zero years, as opposed to fourteen or seventeen or twenty or whatever.

So much has been written about patents that nobody who reads popular websites about innovation like Slashdot nowadays can reasonably claim to be ignorant of the serious problems that people have pointed out about patents. The view that patents make innovation worse, not better, is a respectable and widely held view, if not as widely held as the opposite view.

The only number between

The only number between zero and infinity that is not arbitrary is zero itself.

The number of years for drug patents that maximises average life expectancy is not arbitrary. It's very hard to know it, but valid arguments can be made that it's strictly greater than 0.

If you read /. you'll notice trivial and software patents are being opposed but you'll find few opponents to patents on drugs.

Wrong

As I pointed out, I wrote, "on the face of it", and I was talking about a hypothesis. That's the context. Sure, the data might prove something different, but qua hypothesis (as opposed to experimental result), the less arbitrary hypothesis is zero years.

If you read /. you'll notice trivial and software patents are being opposed but you'll find few opponents to patents on drugs.

There's plenty of the wider stuff to run across too, if you like to read, which I do.

 

The best educated guess than

The best educated guess than we can make while spending a limited amount of ressource on making that guess is not arbitrary and is probably greater than 0.

So you say

Where is your argument? "I am Arthur and I am wise." Is that it? Give me an argument, not your judgment.

 

 

 

The number Arthur comes up

The number Arthur comes up with is no more arbitrary than 0.

Are you asking for an argument that some numbers are not arbitrary or that the optimal in some sort of measure has to be greater than 0 ?

Parsimony

The most parsimonious hypothesis is zero, because zero means "no patents at all". This, among many other reasons, makes zero special, and its choice non-arbitrary. Zero is also special for another very important reason: most proposals, even plausible-looking ones that people come up with to improve the economy by government intervention are wrong. Therefore the answer to the question, "how much should we implement this (e.g. how much time, money, effort)" is usually zero. This makes "zero" the best choice from a purely probabilistic standpoint.

Here's what The Concise Encyclopedia of Economics has to say about the state of knowledge, which is a key element of my argument:

"The problem of determining the optimal term of intellectual property protection is that no one knows any of the key pieces of information needed to determine the optimal term. These include how much incentive is required to induce creators to create, the size of the harm from reduced consumption during the term of the intellectual property law, the size of the revenues generated during the term of protection that can be used to pay the creator, and future interest rates. No one has these facts, and the difficulty in learning them is such that we may never be in a position to determine the optimal term with any precision."

In the face of ignorance, the answer is usually not "something in the middle". It's usually zero. Suppose, for example, we live in primitive times and people are debating how many goats should be sacrificed to ensure a good harvest or victory in the coming battle. Some say six. Some say zero but they are dismissed as "kooks", because "sensible" people know that the truth always lies somewhere in between and that zero is as arbitrary is any other number of goats. So people decide that two goats is probably the right number.

 

This, among many other

This, among many other reasons, makes zero special.

My claim isn't that zero isn't special but twofold : zero isn't the only "special" number, there's nothing intrinsically wrong with an arbitrary number.

This makes "zero" the best choice from a purely probabilistic standpoint.

Best choice for what? You have to define a criterion.

Suppose, for example, we live in primitive times and people are
debating how many goats should be sacrificed to ensure a good harvest
or victory in the coming battle. Some say six. Some say zero but they
are dismissed as "kooks", because "sensible" people know that the truth
always lies somewhere in between and that zero is as arbitrary is any
other number of goats. So people decide that two goats is probably the
right number.

The article you cite only claims we ignore where the optimum sits. It does not mean we ignore there is an optimum, in fact we could know there is a positive optimum without knowing its exact value. Your goats example is irrelevant as we understand the qualitative effect of patents and our ignorance lies on their quantitative effects.

Didn't say otherwise

My claim isn't that zero isn't special but twofold : zero isn't the
only "special" number, there's nothing intrinsically wrong with an
arbitrary number.

I didn't say there was anything intrinsically wrong with it. I'm giving reasons to pick "zero" as our initial guess, reasons why "zero" is a pretty good choice, as a counterpoint to your assertion that it is probably greater than zero. I am not denying the possibility that it is not zero, I am rejecting your presumption that the optimum probably is not zero.

Best choice for what? You have to define a criterion.

I already explained and you took the explanation out of the stuff you quoted without addressing it so I have no way of knowing where my explanation falls short.

The article you cite only claims we ignore where the optimum sits. It
does not mean we ignore there is an optimum, in fact we could know
there is a positive optimum without knowing its exact value.

I never said otherwise. I quoted the article for one reason and one reason only, because it acknowledges that we do not know what we need to know to determine it. By the way, I think the stuff about "any precision" is a copout. Nobody is asking for "precision". An approximation would be fine. If the paragraph's description of the state of knowledge is fair then we do not even know the approximate value of the optimal term. Given that we do not know very much, we should not be so cocksure as so many people are that it is above zero (or enough above zero to bother implementing a patent system). I am supplying a corrective to the popular (but not universal) presumption of positivity and are misconstruing it at every point, taking me as arguing that there is something "intrinsically wrong" with an arbitrary number and so on.

Your goats
example is irrelevant as we understand the qualitative effect of
patents and our ignorance lies on their quantitative effects.

But I already mentioned plausible-seeming government interventions in the economy that turned out to be worse than nothing. Substitute any one of those for the goat sacrifice. Those have arguments pro and con plausible to modern minds, same as patents.

This commenting system is a

This commenting system is a pain.  One has to carefully keep track of widths to decipher which comment responds to which.

Oh, and,, in response, you may be right.  I simply have no information on copyright vs. patent defenders.

Lazyness

1. Lazyness inhibits progress.

2. Lazyness kills-- People are dying for want of drugs that weren't developed because people were too lazy to produce them.

3. Lazy people are killing us by slacking in order to avoid being overworked. This is despicable at best.

It is correct to oppose leftism, but it should be done on its actual crimes and on its politic which is intrisically wrong, not on distant consequences as non-criminal attitudes can have similar consequences.

Any reason we can't oppose

Any reason we can't oppose both?

You can oppose both, but

You can oppose both, but lazyness should not be opposed by force while leftism can. A criticism of leftism which applies also to lazyness implies either too a weak a criticism against leftism or too strong a criticism of lazyness.

No, It Doesn't

There are other criticisms of leftism that don't apply to laziness.  The sum of these criticisms may very well be greater than the sum of criticism one could make of laziness, justifying differential treatment of the two vices.  And this is all consistent with the criticism being of the ideal strength, neither too strong nor weak.

The nazis were bad people

The nazis were bad people because they burned books and thus released CO2 furthering global warming.

While such a criticism may or may not be correct, it's ommission is striking. When one is making a criticism, it is implicit that other much stronger criticism should be acknoweldged. Ommitting them is akin to minimizing their importance.

 

No

While such a criticism may or may not be correct, it's ommission is striking. When one is making a criticism, it is implicit that other much stronger criticism should be acknoweldged. Ommitting them is akin to minimizing their importance.

None of this is true.

Language is subjective, you

Language is subjective, you say something in order to be understood, that implies taking into account that the interlocutor will expect certain statements to be made in certain occasions and will implicitely assume that you do not think they are true if you don't make them. You may not like it but that's the way it is, ommissions are a meaningfull part of any statement.

Arthur, I agree with all

Arthur, I agree with all this. But none of it applies to anything Brandon or I wrote. Brandon did not say leftism is wrong because it stifles innovation; he said leftism stifles innovation.

What

What exactly do you mean by, "leftism?" I understand the stigma of considering yourself, "leftist," but I feel too often people simply accept that those that call themselves, "left," really represent anti-establishment, counter-cultural, counter-economic principles at all.

Libertarians & IP

I saw at the Mises blog there's an issue in Regulation Magazine on the divisions within libertarianism on the issue
http://blog.mises.org/archives/007721.asp