Digital technology under scrutiny.

• Position: Copyright Law - Law school professor Robert P. Merges on the viability of compulsory licensing

America's creative energy and entrepreneurship are known the world over. Property rights, contracts, and voluntary markets have played a primary role in the development of vibrant industries in the U.S. University of California-Berkeley Law School professor Robert P. Merges argues that these, the "building blocks of all creative endeavors," are just as relevant in the digital era as ever, and, in fact, underpin the conditions for "future growth and diversification" in intellectual property.

In his study, Merges dissects a concept in copyright law called compulsory licensing, which has developed a following among prominent intellectual property experts and users of digitally-based technologies. Falling midway between granting full, unlimited copyright to owners of creative works, and denying it altogether, compulsory licensing forces copyright owners to allow use of their works under price and usage restrictions set by Congress.

Some supporters of compulsory licensing contend that full copyright gives creators too much control, while artists complain that they have no incentive to design if they do not receive compensation for their work. To mitigate these differences, compulsory licensing has been established in certain industries where "transaction costs"--the...