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Intellectual Property and the Incentive Fallacy

58 Pages Posted: 24 Jan 2011 Last revised: 25 Jun 2014

Eric E. Johnson

University of North Dakota School of Law

Date Written: January 23, 2011


The enterprise of intellectual property law has long been based on the premise that external incentives – such as copyrights and patents – are necessary to get people to produce artistic works and technological innovations. This article argues that this foundational belief is wrong. Using recent advances in behavioral economics, psychology, and business-management studies, along with empirical investigations of industry, it is now possible to construct a compelling case that the incentive theory, as a general matter, is mistaken, and that natural and intrinsic motivations will cause technology and the arts to flourish even in the absence of externally supplied rewards. The result is that intellectual property law itself needs a fundamental rethinking.

Keywords: Behavioral Economics, Intellectual Property, Copyright, Patent, Incentives, Intrinsic Motivation, Psychology, Classical Economics

JEL Classification: O31, H3, K00

Suggested Citation

Johnson, Eric E., Intellectual Property and the Incentive Fallacy (January 23, 2011). 39 Florida State University Law Review 623. Available at SSRN:

Eric E. Johnson (Contact Author)

University of North Dakota School of Law ( email )

P.O. Box 9003
Grand Forks, ND 58202-9003
United States


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