A Portrait of the Artist Under Copyright

A common refrain in the copyright research literature is the tradeoff between creativity and access. Copyrights that are too strong inhibit access to the work; copyrights that are too weak limit incentives to create. Copyrighted works take a long time to enter into the public domain. During the period when a work is under copyright, the work can be expensive to the general public due to non-competitive pricing. The rights holder may be unwilling to license the work widely or may disapprove of the intended use of the work by a party seeking a license.  Hence a common criticism of the copyright system is that it impedes the circulation of knowledge.  A case I have in mind to illustrate the issues is that of academic publishing, given my academic background.  Academics depend heavily on journals and textbooks not only to learn but also to disseminate their research.  They can circulate their findings through working papers, but these do not have the imprimatur of peer review.

As with other creative output, textbooks involve a team effort beyond the author. Labor and material costs, and promotional expenses, comprise that effort.  Similarly, team effort is behind journal production.  Journal articles are relatively easy to copy or pirate. Levels of copyright protection should therefore be proportional to the ease of misappropriation as well as the development costs.  Indeed, for journals, publishers often require that authors transfer the copyright to them.  The publishers are then responsible for development and marketing.

But because of copyrights, and the market structure of publishers, textbook prices and journal subscription fees tend to be quite hefty. Even a single article from a journal can cost upwards of $39 to purchase. This puts scholarly works out of reach for most poor households and for researchers in poor countries.  Academic books and journals are particularly expensive because of the lack of economies of scale.  The market size is very small, consisting mainly of a tiny fraction of the world’s population of researchers with advanced degrees.  Chances are that only a couple of dozen people have ever read one of my abstruse journal articles.  With this small customer base, academic publishers cannot spread their overhead costs as thinly as needed to reduce prices significantly.

How then are scholarly works made affordable? Several ways exist. First, the primary consumers of academic books and journals are employed in universities.  University libraries purchase books and subscribe to journals on their behalf.  (Government agencies and research institutes can also provide this service to their research staff.) Publishers like Elsevier, Wiley, Taylor and Francis, and Springer Nature produce multiple journals from multiple disciplines. Libraries typically contract to subscribe to the publisher’s journals as a bundle. Faculty and students then access the articles for free.  Second, publishers practice the art of price discrimination, charging different prices to different types of consumers depending on their elasticities of demand. Individual subscribers pay less than, say, libraries or research institutes do.  Third, open access journals are available. (Some journals provide open access options to authors.) Under open access, the author(s) retain copyrights and the readers access articles for free. How are open access journals then financed if they do not charge readers?  Largely, the authors pay the cost, and the authors obtain the funds from their research grants.  Grant foundations and agencies do allow open access fees to be budgeted.

While these measures help with affordability, there are gaps.  Authors without sponsored research grants may not be able to pay the open access fees.  Researchers who are not affiliated with a university or a research organization, or who are affiliated with a university in a developing country whose library cannot afford the site license fees, will be precluded from free access.  Price discrimination schemes can only go so far.  For price discrimination to succeed, resale must be prevented. This is challenging to do for electronic copies. Indeed, a pirate site called Sci-Hub exists, which is the Napster-equivalent for journal articles.  Founded by a programming student from Kazakhstan, the site hosts downloaded copies of published articles and makes them available for free. Copyright authorities have tried to shut the site down, but it manages to re-emerge. How sites like this will impact the publishing industry have yet to be measured.

A 2018 documentary film available on YouTube entitled Paywall has leveled highly charged criticisms against the oligopoly of journal publishing companies. It laments the high prices of academic journals, the high profit margins of publishers, and the possible locking up of scientific knowledge due to monopoly pricing. In addition to advocating for open access journals and viewing Sci-Hub sympathetically, the film deplores the idea that publishers are charging the public for journal articles that were originally created using taxpayer dollars.  It is true that a lot of scientific and humanities scholarship is funded by government grants; however, the economics behind that statement are a bit more complex.  Not all authors of journal articles have been funded through grants, whether sponsored by industry or the federal government. Such funding, when it occurs, covers research expenses, such as field work, clinical trials, lab assistants, post-doctoral fellows, conference travel, and so forth. The research funds do not generally share in the cost of producing the journals, except those earmarked for open access fees. (The publicly funded grants could stipulate that awardees make the data and research findings available, but this is a different issue.) As mentioned earlier, researchers rarely pay directly for access to journals.  Libraries pay on their behalf. Moreover, in reality, journal articles are not the most timely source of new ideas and findings. Given the publication lag – that is, the time it takes for peer review and for articles to appear in journals – researchers are more likely to depend on working papers or presentations at conferences for the most up-to-date knowledge.

That said, some insightful points can be gleaned from the film. First, publishers do benefit because the primary intellectual laborer – the authors – are unpaid. The economist Theodore Bergstrom calls this “free labor for costly journals.” In fact, authors pay the journal oftentimes for the cost of peer review.

Nonetheless, authors do derive non-monetary benefits from publishing an article in a journal, such as reputational enhancement, which improves their chances of promotion and winning prizes and grants.

Second, there is no circular flow between journal sales and research. In other industries, such as the pharmaceutical or energy industry, profits can be ploughed back into R&D.  But the profits from academic publishing and the research expenditures by academic scholars are separate and disconnected. For generating a circular flow between them, a topic for future study and debate might be to think about structuring an alliance between publishers and academic networks. The relationship can be in-house or arms-length.  Research and publishing are complementary endeavors, so perhaps should their organizations be.

In closing, copyright protection is marked by tensions. It has the capacity to underwrite investments in creative work and commercialization, while posing barriers for public access to the works, whether financial or legal.  In any case, access is key to sustaining creative growth and development, and will be the subject of continuing debate.  James Joyce’s character, Stephen Dedalus, has the last word: