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Reasoning for LSAC ban on PDFs?
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Live Sage ⭐
I was wondering about the reasoning why they did this. Do they really make more money by not licensing out PDF versions of the exam? Were websites offering them without LSAC approval? I was thinking about this today, and I find the former more probable than the latter. Long term trends for people taking the LSAT and applying to law school are down. Why raise the costs (at the margin) for those that want to study? Wouldn't this put even more downward pressure on people taking the LSAT, and thus, hurt LSAC's revenue growth? Raising the fee on the exam at least made a little more sense since they have a monopoly on the test administration, but there is competition for study materials. I don't understand what the purpose is, or in what scenario that this made any business sense.
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The LSAC must have been really hurting from these illegal downloads. Why enforce the copyright if you don't gain anything from enforcement? I wonder how they valued the "lost" licensing fees compared to the benefits of the enforcement. I'd also be curious how this will affect future testing numbers. It's going to be hard to probably definitively prove (since the test numbers are endogenous), but I would guess that the effect of the tightening of the enforcement is going to be a net negative for the LSAC. Who knows though.
Even more important, this hurts those that actually want to study more so than those that don't want to study. At the extremes, the person that isn't going to study, walk in, and get their score was never going to purchase prep materials anyway. The LSAC has disproportionally increased the search costs on the people that want to increase their score/study (which affects their cost benefit in taking the exam). As a result, fewer studious, hard working students will probably take the exam--those that would make "better" lawyers on average in the first place.
This move from the LSAC is just another typical one in an industry with a government protected monopoly...
I disagree with you here. I think that the studious, hard-working students are those who are most apt to recognize the small investment in study materials will pay off in the long run. And it's not like LSAC is no longer providing tests; the booklets of tests are available for purchase at a pretty low cost to students. The only thing that the policy harms is convenience, but if you were LSAC and your intellectually property were getting abused, why wouldn't you seek to put a stop to this action?
I see what you are saying here, but I disagree. What I meant in my extremism example is to really convey the marginal student. It is true that the most studious students would probably still seek out prep materials. However, the marginal student maybe would not (depending on how they value their expected benefit for attending law school compared the additional increase in the search cost/convenience cost). A good counter to that would be "So what, there are too many lawyers anyway." Nevertheless, the effect of the LSAC's ban puts pressure on the margin the wrong way. You shouldn't increase the search costs on those that have a higher chance of succeeding in law school/succeeding in law. You should make it more difficult for people who will have a propensity to fail at law. The increase in the administration fee better does that, which is why I think it was better policy; the LSAC doesn't care about public policy (nor should it), though. However, the government protection of its monopoly has a negative effect for the lawyer job market for the reasons above.
Additionally, I don't agree with your assessment of copyright enforcement. The LSAC was laxer one year ago in its copyright enforcement strategy than today (by allowing PDFs). They changed their minds because they probably figured that it was costing them money. In other words, just because you have an intellectual property right claim and that claim is abused, it shouldn't be a sufficient reason for the LSAC to act since there are cost considerations as well. Now, the LSAC has burdened itself with additional enforcement costs that it did not have one year ago (by making sure that the copyright is not being infringed, potential court actions, etc.). Someone at the LSAC probably crunched the numbers and discovered that the benefit of stopping the copyright abuse outweighed the enforcement cost, and that is why they acted.
I'm also confused at your response to the copyright analysis. We are largely saying the same thing, if only different in degree as you include slightly more nuance that may or may not be true. There are two considerations I can see for deciding to protect their intellectual property.
First is cost, as you mentioned, and if someone crunched the numbers and found out that they were losing money through the pirating of tests, then it's hard to see why they wouldn't choose to put a stop to this--especially when PDFs are only a convenience for students and test prep companies.
Second is principle. The intellectual property that these tests contain is theirs and solely theirs. If they believe that something they own is being stolen from them, and they wish to put a stop to this illegality, then the decision to cut off the source of the illegality is a reasonable one. True, it may have the unintended consequence of worsening the problem by encouraging the illegal transfer of test material, but the route they chose was one that can be logically understood. Whether it is a large corporation or a small business is beside the point, and framing LSAC as The Big Bad is an just an emotional appeal. If someone believes property that they own, that they paid to research and develop, is being stolen, then it's their right to try to protect their property and investment. In this light, it wouldn't be necessary for LSAC or anyone to be really hurting monetarily by the illegal transfer of property, only that they are angered or bothered that the IP they own is being abused.
In any case, I suspect in the future that LSAC will themselves offer the option of buying PDFs once it can be ensured that they can't be easily re-distributed (or once a security method can be applied so that re-distribution is very unlikely). There's no way that can result in perfect enforcement, but to knock them for trying seems disingenuous.
I don't really see how I flipped my argument (I was lazy with some wording I admit though). I am not saying that not having PDFs is going to be the end all/absolute reason that someone is not going to attend law school. I am instead arguing that on the margin, it creates a higher disincentive (whether this is material or not depends on individual cases) . Sure, it is probably minor inconvenience, but still is an increase in cost. I think the marginal effect (which what I probably should have initially said in my post instead of marginal student) is different for different types of students. That was what I was truly trying to say.
Also, I am in agreement with most of what you say about copyright protection, except partially with the second principle. I agree think their action is reasonable, but not necessarily logically understood (I am going to equate "logically understood" with "rational" for the rest of the post). They protected their IP by successfully getting a copyright claim, and it is their right to enforce it as they so choose (this is why it is reasonable for them to do what they did). Nevertheless, this doesn't mean that the action was rational. The research and development of the tests is a sunk cost to the LSAC, and should be disregarded in the enforcement decision making about the PDF enforcement. The only things that should be considered in deciding to actually enforce a claim (from a firm perspective), is the expected future benefits of enforcement vs. expected costs of enforcement. The LSAC (hopefully) understood this and acted as such.
Additionally, I wasn't making an emotional appeal against the LSAC. They do have every right to limit PDFs since it is their IP, and they certainly have every right to do whatever they want with it. I was more commenting on the nature of the industry as a whole and the market conditions as a whole that has led to the LSAC monopoly. I view the market in which the LSAC operates in as a failure/bad. The LSAC is just reacting strategically to its best advantage. I didn't mean to imply that the LSAC is a big, evil company, to the contrary, I somewhat admire them for exploiting their market opportunity. I just don't agree with their strategy. The LSAC as a ton more information than I do, so there is a very good chance I am wrong.
Your last paragraph I think is absolutely true. I think it is the reason why the LSAC is trying to gobble up the tests from the Internet.
Haha. This is hell of a lot more fun than doing LR questions! Truly, this discussion is awesome. It went from my shower thoughts all they way to economics of IP enforcement.
Either way, fun conversation, and even for nothing else, that it made @nye8870's comment possible makes the conversation a net gain for mankind...or at least LSATkind.
"T]he magnitude of the predictive power of LSAT is modest compared to how heavily schools weight LSAT scores. A 6-point LSAT difference is enough to make a dispositive difference in where one attends law school and whether one receives a six-figure scholarship – but even that large an LSAT gap really predicts only a modest 0.1 difference in LGPA…"
They did note that it's more predictive of first year grades. Here's more, if anyone is interested:
http://www.wsj.com/articles/BL-LB-51704
There's this too, which is cool!
"But a new research paper says the very act of studying for the law school entrance exam actually alters your brain structure – and could make you smarter.
Intensive study for the Law School Admission Test reinforces circuits in the brain and can bridge the gap between the right and left hemispheres, according to researchers at the University of California, Berkeley Department of Psychology and U.C.’s Helen Wills Neuroscience Institute, the National Law Journal reported."
http://www.wsj.com/articles/BL-LB-43339