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Intellectual property


The motivations for buying a good or service are highly complex. At the most basic level, people buy goods because of what the goods do or because of the aesthetic elements they embody. More technically, buyers derive utility from the "functional" quality of these goods. Another motivation relates to what the goods "say" about the buyer. Here, the good is a signaling device. Signaling is not new, of course, and can indicate anything from social class to political leanings.

This Essay addresses the issue of whether it should be public policy to subsidize this type of person-to-person status signaling. This question falls within the general category of issues related to the production and dissemination of information. As a general matter, it appears that markets, if left unregulated, do not produce efficient levels of information. This is in large measure due to free-riding problems that prevent those producing information from limiting its use to those who pay for it. Free-riding, of course, is the underlying rationale for American intellectual property law.