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Creative output as the public good

by Simon Webster

In most introductory economics courses, students are presented with the idea of the public good. It usually goes something like this: a series of examples of public goods are given, often parks or street lamps or other suitably Dickensian amenities, and students are asked whether they have, in the past 7 days, made use of such things?

Of course they have.
Then comes the follow up question: and how many of you paid for the street lamp's lighting, or the park's serenity?
None.
This is the public good conundrum: we agree that public goods are desirable, that our social fabric benefits from their existence—(we make this clear by voting with our feet and flocking to parks or to the beach on the weekend, or by kicking up a fuss when our unhindered enjoyment of a public good is threatened) - but when it comes time to pay for them, to vote with our wallets, our fervour seems to dim.
And so, no better alternative having made itself known, we pay for public goods indirectly.

When it comes to films and television content - or any form of creative output that can be stored, duplicated and transmitted digitally - an argument can be made that they have become, to some degree, quasi-public goods.

Our society has long embraced the importance of storytelling, and the value to a culture of its people seeing lives like theirs reflected on screen, however as technology has advanced and methods of duplication and distribution have become limitless, our consumption of film and television content has run into a free rider problem.

Let's take another look at the example of film and television, through the prism of the public goods analogy. Does one person's illegal downloading of a film or a television series diminish the good in the same way that one's consumption of, say, a slice of cake diminishes the cake?
No.
Does one person’s illegal downloading of a film or television series limit another person's ability to legally enjoy the good as would, say, one person's use of a swing set?
Nope.
Are those who do not wish to pay to go see films easily excluded from downloading them?
Not at all.
Of course, some of these answers are only half true. Whilst one person's illegal downloading of a film or a television series does not directly diminish that good, nor does it directly limit another person's ability to legally enjoy it, it may indirectly do so. These issues arise when such habits of consumption (i.e. illegal downloading) become the dominant method through which films and television series are consumed.

It is fitting that, as alluded to above, the public goods examples favoured by university lecturers often have a hint of Dickens about them, as Dickens himself as an early agitator in the push for the establishment of international recognition of copyright.
When Dickens travelled to America in 1842, he was visiting a place that did not recognise the copyright of non-residents. Fed up with being a victim of transatlantic piracy, (his novels being cheaply knocked off by American publishers, who paid no royalties for the privilege), Dickens railed against the industry and lobbied Congress for change. It was an uphill battle - Dickens' efforts, at least initially, proved fruitless, and he would return to England dejected.

In the years that followed, Dickens latched onto the personal experiences of authors such as Sir Walter Scott (who, Dickens argued, would have avoided bankruptcy, and possibly the fatal deterioration of his health, had he been paid appropriate royalties) and Captain Frederick Marryat (who, though domiciled in America, was forced to renounce his status as a British subject in order to enjoy copyright protection there) to press his case.

It was the human toll of piracy that brought the issue more squarely into frame. (Incidentally, American authors also lost out, as local readers purchased the cheap British knock-offs in place of full-priced American novels.)

In Dickens' day, to take advantage of the landlocked copyright schemes, one had to acquire a novel in England, put it on a ship for twenty days to America, transcribe its contents and then reproduce it by the thousands so that it could be sold on a profitable scale.
Today, if one wants to reproduce and transmit a film or a television series from, say, a bedroom in Sydney to a kitchen in Cape Town, a boarding house in Bengaluru, or a studio in Santiago - (or, more to the point, to all of those and more) - all one needs to do is jump on their laptop.

In the old days, American publishers would head to the docks to intercept the incoming pirated books, and British officials would confiscate American knock-offs when they presented on British soil.

The question to be answered is: how should the present day piracy of films and television series be tackled, when it's not so easy to meet the pirated goods at the dock?

The answer, I think, must be manifold, but for the purpose of this post I will argue that one way in which behaviours might be changed - (leaving aside for a minute the punitive measures of statutory penalties, or the intervention of site-blocking) - would be to think of creative output as something of a public good, in the sense that we all seem to agree that our lives are enriched by its presence.

With this in mind, there needs to be a regulatory framework that fosters and encourages the production of creative output, and protects those producers that are doing so successfully. Piracy occurs in line with demand for those products, affecting those films and television series that are doing well the most.

Whereas, in the pure public goods example, governments are often the most appropriate producers of things, here it is quite clearly the creators, the writers and directors who are already doing so who ought to continue.
The government's role should be to facilitate this continued creation by ensuring that copyright is protected, by making available grants and subsidies that are not restrictive on their recipients, by taking action against persons who are found to be pirating creative content and by ensuring that smaller producers, such as independent Australian film-makers, are given a level playing field on which to compete - they have shown that they are more than capable of doing so.

This, like a public good, would be for the benefit of all Australians.

-- Simon Webster is a Perth-based lawyer.

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