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Harry Potter Escapes From Protectionists in China
The NYT reports that there are a large number of Harry Potter books available in China, many more than in the United States. In addition to the authorized copies of the books authored by J.K. Rowling, there are unauthorized copies of these books, there are books that claim to be authored by Ms. Rowling, but in fact were written by other people, and there are Harry Potter books that were openly written by other people.
Unfortunately, the NYT article makes no effort to distinguish between these different types of unauthorized books, using the terms "piracy" and "counterfeit" in a haphazard manner. In fact, there are very important distinctions between the different types of unauthorized copies discussed in the article. The differences are important both in the sense of who is being hurt and also the enforcement issues that are likely to arise in China.
In the case of the unauthorized copies of the actual book, the only people who are directly harmed are the publisher of the authorized version and J.K. Rowling, who will not collect royalties from unauthorized copies. The readers benefit hugely from gaining the opportunity to buy the book at a lower price. The Chinese economy will also benefit, since Harry Potter readers will have more money left over to buy other goods and services.
The issue is more ambiguous when a Harry Potter book is sold that is ostensibly written by J.K. Rowling, but was actually written by someone else. This can be considered a counterfeit, if the reader really believed that the book was written by Ms. Rowling and was part of the Harry Potter series. On the other hand, if the reader bought the book knowing that it was not authored by Ms. Rowling, then it is a pure benefit to the Chinese economy that such volumes are available. It is possible that Ms. Rowling will lose to the extent that these books are substitutes for Harry Potter books among Chinese readers. Also, if people wrongly believe that she authored these books, then it could harm her reputation if these books are not very good. (Of course, if is also possible that it would benefit her, by improving her reputation, if these books are well-written.)
Finally, there are Harry Potter books that are explicitly authored by other people. These books are clearly not counterfeits, since readers are presumably well aware of the fact these books were not authored by Ms. Rowling. These books are a pure gain for Chinese readers, since they make books available that would otherwise be prohibited by Ms. Rowling's copyrights. These books could either help or hurt Ms. Rowling depending on whether they are more likely to satiate readers' interest in Harry Potter or to increase the commitment of Harry Potter readers.
It would have been helpful if the NYT had distinguished the various issues that come into play in supressing unauthorized copies. The Chinese government is presumably less likely to enforce laws when the main impact is negative for people in China. This means that a crackdown on unauthorized copies of the offical version of the book may be diffiuclt to stop, as would books that extend the Harry Potter stories in different direction, but were explicitly not written by Ms. Rowling.
On the other hand, it may be easier to enforce laws that prevent people from claiming that Ms. Rowling wrote a book that she did not in fact write. The reason is that many readers may be upset to find that the book they bought was not very good and was not actually written by Ms. Rowling. In this case, the book would be an actual counterfeit, which means that the buyer herself is harmed, not just a person who has a claim to intellectual property in the product.
--Dean Baker
COMMENTS (7)
I know of Dr. Baker's scepticism concering copyrights so the article was a new twist on the current H Potter mania vis a vis Rowling's and publisher's rights. But could someone please be more careful when proof reading these? Lots of typos and misspells make erode a reader's confidence in the content.
thank you.
Posted by: Anonymous | July 31, 2007 11:48 PM
Thank you for pointing out how complicated the question of who gets harmed in copyrights vs. "piracy" (yo-ho) debates is.
Posted by: James M. Jensen II | August 1, 2007 8:12 AM
Dean,
I agree that the article should have been more in depth regarding the specific costs of different types of counterfeiting, however I disagree with your assesment of the costs.
You write that the "only" people harmed by direct counterfeits are Rowling and the publishers, and that the readers benefit "hugely", as well as the chinese economy. Won't Rowling and the Publishers will be harmed an even more "huge" amount than the readers benefit? Assume the actual book costs $20 and the counterfeit costs $1. Chinese consumers still spend $1 for the knock-off, creating a benefit of $19 for the chinese consumer, whereas Rowling and the Publishers lose $20. Yet you minimize their loss and emphasize the Chinese readers gain? Whats the reasoning behind this?
As for the benefit to the Chinese economy, the same amount that goes to Ms.Rowling and the publisher goes into their respective national economies as well.
Not to mention the lax Chinese laws or lack of enforcement that fail to stop the counterfeiting of Harry Potter, also lead to the counterfeiting of countless other authors, filmmakers, and other content creators.
Because book industry, music industry, and film industry all have scale effects, the increased quantity of the chinese market would mean lower average costs for the publisher. The lower costs would translate to lower prices for American, British, and other consumers. The inability to sell their content on the Chinese market means U.S. and other consumers subsidize the creation of the content for those who purchase counterfeits.
If you are going to criticize the Times for failing to discuss costs, you should be sure to discuss all the costs yourself.
Posted by: AO | August 1, 2007 10:09 PM
Over at FanFiction.net, there are 309,929 works in the Harry Potter section. The Chinese have some catching up to do. :-)
Posted by: Indiana Joe | August 2, 2007 4:20 PM
AO,
In the case where the a reproduction is sold in China for $1 versus $20 for the authorized version, at least $1 of the $20 recieved by the copyright holder is likely to go to printing and publishing costs. This is no gain to them, which is why I didn't include it as a loss.
As far as incentives to others, of course that is the rationale for copyright (after a work is done, you can't provide incentive after the fact). I assume that BTP readers understand this.
Posted by: Dean Baker | August 3, 2007 12:12 PM
"As far as incentives to others, of course that is the rationale for copyright (after a work is done, you can't provide incentive after the fact). I assume that BTP readers understand this."
Yes, we do, thank you Dean.
AO wrote
"As for the benefit to the Chinese economy, the same amount that goes to Ms.Rowling and the publisher goes into their respective national economies as well."
How's that? I assume the bookseller that sells the authorised copy would also sell the unauthorised one. So, how does their economy benefit if the royalties flow out of it when booksellers sell authorised copies? I don't see any gain there.
Posted by: Wynand | August 7, 2007 6:50 AM
One solution for solving this copyright issue is for the publishers to get in touch with local publishers in China and publish the books in low cost editions.
Posted by: Water4Gas | April 7, 2008 6:42 PM