Notice & Comment

The Logic of Institutional Change: A Comment on Halabi’s Intellectual Property and the New International Economic Order

Don’t let the title deceive you: this is not simply a book about international intellectual property law (though it is obviously at least that). Sam’s rich account of the asymmetries in international intellectual property protections and the ways that poorer countries fight back bears on a cross-disciplinary conversation in institutional change that is worth highlighting, including for those (like me) with no relevant expertise in intellectual property law. For my contribution to this symposium, then, I want to focus on the conception of “institutions” and how Sam’s book traces not just institutional development—how we got to where we are. But also institutional evolution—a more subtle process of accounting for historical change that looks at the present not as an equilibrium of any permanence or even an equilibrium at all. To invoke Faulkner’s shopworn but still potent truism, what Sam shows us is that the past of institutional change is not dead. It’s not even past.

The term “institution” is a curious one invoked ambidextrously if confusingly to refer both to organizations (think the Brookings Institution) and patterns, practices, laws, and norms (think the institution of marriage). Scholars from many disciplines—such as new institutional economics (economics), the organizational synthesis (history), historical institutionalism (political science and sociology)—have grappled with how we can understand institutions. Given the centrality that law plays in both establishing organizations (like, say, the WTO) and in making some norms stickier than others, legal scholars have had a lot to say about institutions of all kinds, especially in the area of customary law and soft law of international relations.

Two of the questions motivating many of these scholars in these traditions are these: what are institutions and how do they change? Where I see Intellectual Property and the New International Economic Order making a contribution (although not self-consciously: Sam isn’t focused primarily on the questions of institutional change) is in the rich detail he musters in support of his central argument about how the institutional framework of determining which rights are enforced and which are excepted changes, sometimes under the radar.

The biggest example that Sam teases in his preface and then demonstrates with force throughout the book is the complicated connection between multinational firms and the nation-state. As he writes, “[a]ssertions or implications that at some point in time (the 1950s, the 1970s, the 1990s, etc.) either the ‘state’ or the ‘firm’ retreated were only inflection points in a more complex system of agents that endeavor to write, influence, or revoke international rules for their own benefit. The international competitive states’ system means that states and firms will always work as agents for each other under circumstances that may change rapidly.” (page xv, emphasis mine and explained in a moment).

In thinking through the institutional development, both organizationally and in practice, of any international phenomenon, that curious relationship between the nation-state and global firms cannot be assumed away. The relationship has been at the foundation of debates about accounting errors and the meaning of trade deficits, about military responsibilities and what counts as protected national interests, even about the basic work of defining political communities. It is also one of the most important questions in economic history, given the surging dominance of the nation-state late in the early modern era. As nations asserted identity and shaped errant populations into conformity in sometimes bloody ways, the perennial questions were and are still the same: who is governing? And to what end?

Sometimes Sam confronts this question head on; most of the time, it’s more implicit, hence the reason scholars from many fields will be stimulated by Sam’s ideas. What he teaches readers is that even as firms and nation-states alternate in supremacy in policymaking, the institutional order today exists to place the nation-state firmly in control of the formalities of the policymaking apparatus. In the emphasized quote above, in Sam’s account we see firms making use of the prerogatives of nationhood to accomplish goals that are existential for the firms in question but of little or negative consequence for the nations that sponsor them.  How and why and when firms accomplish this extraordinary feat is addressed in this book, but will continue to foment discussion among historians and other scholars trying to understand the logic behind the nation-state’s triumph (and, perhaps, 21st-century resurgence). Chapter 8’s treatment of tobacco’s trademarks against the public health consequences of tobacco consumption provide a good example of this—after all, don’t Swiss citizens want to see Uruguayans experience more robust public health than the Swiss tobacco companies might prefer, no matter the cost to those Swiss companies’ trademarks?

Using Sam’s book as a source, we can answer those governance questions by saying that neither nation-state nor firm governs, but institutions do, as both principals and agents. And in the short run, the institutions of international intellectual property have governed to enforce protections asymmetrically, but not for long. This is where Sam’s conception of “intellectual property shelters” comes into play. In that idea, Sam describes how other communities within the nation-state seek to assert themselves against the logic of the incumbent institutional regime not to displace it, but to refine it. Indeed, core to Sam’s argument is that these efforts in public health and food security are about redefining the institutional framework that enforces intellectual property rights throughout the world sub rosa: until Sam’s book, scholars and policymakers didn’t relate these efforts in public health to the broader intellectual property regime (at least, that’s what I understand to be Sam’s claim about the novelty of these ideas).

If Sam is right about this silent revolution, we might be witnessing a movement toward profound institutional change in intellectual property. That will matter not only to those who focus on intellectual property, but also an instance of broader relevance to those who study institutional change generally.

This post is part of a symposium reviewing Intellectual Property and the New International Economic Order: Oligopoly, Regulation, and Wealth Redistribution in the Global Knowledge Economy, a new book by Sam Halabi, Associate Professor at the University of Missouri School of Law and Scholar at the O’Neill Institute for National and Global Health Law at Georgetown University. All of the posts can be read here.