Law and Information

I’m currently on my way to far-away Olympic Valley, CA, where I have the great pleasure to attend the Gruter Institute for Law and Behavioral Research Conference on Law, Behavior, and the Brain. The conference, led by Monika Gruter Cheney, brings together a terrific interdisciplinary group of roughly 40 experts in areas such as evolutionary biology, neuroscience, behavioral economics, and - yes - also a number of legal scholars. During four days, we will be exploring topics such as “State of Play: Law, Behavioral Biology and Neuroscience,” “Rationality, Emotions and Moral Judgments in Humans and Other Species,” “Property and Economics,” and “Results in Neuroeconomics and Experimental Economics,” to list just a few sessions. I’m much looking forward to learning from all conference contributors, including Paul Zak, Carl Bergstrom, Kevin McCabe, John Clippinger, Bruce Hay, Oliver Goodenough, Susan Bandes, Larry Frolik, Sara Beale, Terry Maroney, among many others.

Here are the abstracts of my contributions to the conference:

1) Panel on Law & Emotions

A recent interdisciplinary conference in Switzerland was dedicated to law & emotion scholarship. In my brief presentation, I would like to answer the apparently trivial question asked by a conference participant: “Given the fact that it isn’t that much of a surprise that even judges, prosecutors, etc. have emotions, and that therefore emotions play a role in decision-making processes with legal relevance, what’s really the contribution of law & emotion research and scholarship? What’s new about it?”. I will try to answer this question in a systematic way, arguing that law & emotion research has (or might have) an impact on (at least) two levels, each consisting of two elements: the analytical level with the elements “phenomenon (stipulated facts)” and “legal actors”, and the design level with “norms applicable to the facts of the case” and “norms governing the production of law.” I will use a few stories - ranging from file-sharing to the U.S. Patriot Act - to illustrate these points.

2) Presentation on Digital Institutions / Social Signaling Theory

Social signals play an important role in defining social relations and structuring societies, both in the on- and offline world. In my presentation, I will focus on the role of social signaling in the digitally networked environment. More precisely, I will explore the promises and limitations of social signaling theory as applied to cyberspace, including digital institutions. In essence, I will address three questions: First, in what online contexts do we have an interest in signal reliability and honest signaling? Second, what are regulatory strategies and approaches (using Lessig’s framework of four modes of regulation) to increase the reliability of social signals? And third, who will make the decisions about the degrees of required signal reliability in cyberspace?

3) New Insights into Property Panel

My last year’s presentation focused on a new generation of neuro-science-informed arguments aimed at explaining large-scale file-sharing over P2P networks. This year, my contribution to the property panel will not focus on the explanation of a presumably illegal activity, but on a socially desirable one: In my talk entitled “Social economics of collaborative creativity”, I will provide a brief overview of the literature that seeks to explain why thousand of volunteers work together in lose-knit networks to peer-produce an online encyclopedia (Wikipedia), to come up with improved versions of an open-source web browser (e.g. Mozilla), or create shared open content platforms, to name just three examples. The presentation ends with the outline of a research agenda.

Over the past few weeks, our graduate students at the Univ. of St. Gallen have done quite some heavy lifting in the three courses that I described here. In my own course on law and economics of intellectual property rights in the digital age, we’ve completed the second part of the course, which consisted of three modules dealing with digital copyright, software and biz methods patents, and trademarks/domain name disputes. We were very fortunate to have the support of three wonderful guest lecturers. Professor John Palfrey taught a terrific class on digital media law and policy (find here his debriefing and putting-into-context). Klaus Schubert, partner with WilmerHale, provided an excellent overview of the current state of software patenting in and across the EU, in the U.S., and Japan and made us think about the hard policy questions up for discussion. Last week, Professor Philippe Gillieron from the Univ. of Lausanne discussed with us the legal and economic aspects of domain name disputes and ways to solve them (the focus was on UDRP – in my view a particularly interesting topic when analyzed through the lens of new institutional economics theory, see also here for variations on this theme.)

In the last session before “flyout” week, Silke Ernst and I had a first cut at a synthesis aimed at tying together several of the core themes we’ve been discussing so far. At the core of the session was the question as to what extent the law & economics approach can help us to deal with the complex IPR-questions that are triggered while transitioning from an analog/offline to a digital/online information environment. The students contributed to the session by presenting their views on the promises of and limits on a law & economics approach to IPR in the digital age. Using the time while traveling from Oxford back to Zurich, my recollection of the in-class discussion looks as follows (alternative interpretations, of course, encouraged and welcome) – starting with the argument that the law & economics approach to IPR serves at least two functions:

• On the one hand, it provides a toolset that helps us to frame, analyze, and evaluate some of the complex phenomena we observe in cyberspace (such as, for instance, large-scale file-sharing over P2P networks or the user-created content), and enables us to gain a better understanding of the interaction among existing rules and norms and these phenomena. We might want to call it the “analytical function” of law & economics (this aspect gets close to - but is in my view not exactly identical with - what has traditionally been described as the “positive” strand of discussion in law & economics.)

• On the other hand, law & economics may guide us at the design level (again, this gets close to what has been termed “normative” law & economics. For reasons I don’t want to discuss here, I don’t want to work with this distinction in the present context.). First, it can help us to identify the need for law reform by showing that the existing rules have a negative impact on social welfare. Here, the design function intersects with the previously mentioned analytical function. Second, law & economics provides a consistent framework to evaluate the impact of alternative means of regulation on the (economic) behavior of individuals and compare costs and benefits of different approaches aimed at solving a particular problem.

At a more granular level, we might identify the following promises and limitations of a law & economics approach with regard to the respective functionality:
Analytical function

• Promises: coherent framework, consistent and shared set of criteria, rational and quasi-objective analysis, …
• Limitations: Bounded rationality/areas of non-rationale behavior, lack of transparency regarding underlying causalities, limited possibilities to quantify phenomena, lack of empirical data, …

Design function:

• Promises: Cost-benefits analysis of alternative policy choices, taking into account perspectives of different actors in an ecosystem, at least ideal-type predictions based on models, …
• Limitations: Complexity of real-life situations, non-economic perspectives, motives, and effects, non-economic values, …

We reached some sort of consensus that the law & economics approach indeed provides a great toolset to analyze at least some of the trickiest IPR-related policy questions in cyberspace. However, the large majority seemed also to agree that some of the limitations of such an analysis become particularly visible in the digitally networked environment with phenomena such as commons-based peer production of content based on intrinsic motivations. Most of us also agreed that it would be dangerous to attempt to answer the IPR policy questions only against the backdrop of law & economics theory. Indeed, many of the decisions to be made in this space ultimately include choices about core values of our society that do not easily translate into the frameworks of law & economics, like for example informational justice, equal access, participatory culture, or semiotic democracy.

I’m very much looking forward to continuing the discussion about the role of law and economics in the digital age with my colleagues, the teaching team, and – most importantly – with the wonderful group of students enrolled in this seminar.

I’ve had the great pleasure to celebrate today the launch of the most comprehensive and rigorous study on state-mandated Internet filtering with my colleagues and friends from the Berkman Center and the OpenNet Initiative, respectively. It was an inspired and inspiring conference here at Oxford University, and after a long day of debate it seems plain to me that the filtering reports from 41 countries presented today will keep us busy for the weeks and months to come.

Extenisve coverage both in traditional media (sse, e.g., BBC) and the blogosphere.

In the closing session, Professor John Palfrey, one of the principle investigators (check out his blog), was kind enough to put me on spot and ask for my take away points. Given the complexity of the information ecosystem including its diverse filtering regimes, it seems hard to come up with any kind of conclusion at this early stage. However, among the probably trickiest problems we might want to think about is the question whether we – as researchers – want and should contribute to the development of some sort of best practice model of speech control on the Internet – a model aimed at “minimizing” the harm done to free speech values in a world where filtering and blocking is likely to continue to exist-, or whether such an endeavor would be counterproductive under any circumstances, either because it would be immediately hijacked by governments to legitimize filtering or used by repressive regimes to make filtering more effective.

Having only a tentative answer to that question, we at the St. Gallen Research Center have started to brainstorm about ways in which various governance approaches to content filtering – focusing on filtering regimes in European countries and the U.S. – could be systematically mapped, analyzed, and compared. So far, we have come up with a set of six guiding questions:

1. Who is obliged or committed to block of filter content?
2. How do the obliged actors become aware of the content that has to be blocked?
3. Who determines what content has to be blocked, and how?
4. What technical means (such as, e.g., IP blocking, URL filtering, etc.) are used?
5. What are the procedural requirements and safeguards in the filtering process?
6. Who sets the rules, under which conditions?

The second issue we’re currently debating is how different filtering regimes can be evaluated, i.e., how the benchmarks for online speech control might look like. In this context, we’re considering the application of generic characteristics of good regulation – including criteria such as efficiency, due process, transparency, accountability, and expertise, among others - to online filtering regimes.

What are your thoughts on this idea as well as on the basic question whether we should get involved in a best practice discussion – even (or especially) if we believe in the power of a marketplace of ideas? Comments, as always, most welcome.