Arnold Kling  

Modern Common-Pool Resources

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Timothy Taylor writes,

The Milgrom, Levin, and Eilat argument is also intriguing because it points out an inherent conflict between property rights and innovation. For example, those who invent something today and seek out a patent must often be concerned that they are potentially overlapping with other patents that have already been granted to others. In some cases, the property rights of already-existing patents can choke off innovation from new competitors. As another example, when many people own property rights to many different plots of land, it may be difficult for a new use of that land to arise--whether it be a nature preserve or a natural gas pipeline--because the existing splintered property rights make it difficult to negotiate for an alternative use of the land. Property rights and market exchange are excellent at finding efficient ways for existing uses, but when it comes to certain kinds of change and innovation, they can sometimes pose drawbacks.

Taylor refers to a paper that looks at radio spectrum as a common-pool resource. The quoted paragraph suggests that ideas also can be viewed as a common-pool resource.

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COMMENTS (6 to date)
James Oswald writes:

Ideas are non-rivalrous, so must be either club goods, if they are excludable, or public goods, if not. In modern times, I would argue that they are public goods, but the political system doesn't want to admit it, so we persist in inefficient institutions.

Becky Hargrove writes:

In Taylor's article, he mentioned that Elinor Ostrom indicated how exclusive property rights could be sometimes better served by alternative systems. Perhaps one alternative might be a property ownership system structured for dynamic and active ownership possibilities that would work together in sync, with group building components that could be moved around as needed. Such a system would not be about owning a specific property but a set amount of property in the actual working system that would be guaranteed to maintain an equally useful function. Potential scenarios could be toggled among participants in a game scenario to see what might 'take' in a group land use setting.

Noah Yetter writes:

At least with land, you know who owns it (in the first world anyway, cf. Hernando de Soto). With tech patents, it's a total crapshoot. You have no idea who is going to claim to "own" ideas essential to a product that you create, because the patents are so vague, and their interpretation so arbitrary and capricious.

AMW writes:

The quoted paragraph suggests that ideas also can be viewed as a common-pool resource.

Actually, I believe what he's describing there is an "anti-common" pool resource. In the commons, any owner can use the resource, but can't stop other owners from using it. Result: overuse. In the anti-commons, any owner can stop other owners from using a resource, but can't use it unilaterally. Result: underuse.

Jeremy, Alabama writes:

Radio spectrum is a common-pool resource that has choked off innovation. A company called Time Domain invented a technique that used ultra-short-duration pings, which means (as math majors know) the energy is smeared across all frequencies as very low level noise. I believe that this was challenged and defeated by existing spectrum holders.

David Friedman writes:

There's an old Martin Bailey article, "The Approximate Optimality of Aboriginal Property Rights," which is about the same issue in a very different context. He argues that primitive societies get property rights about right, using private property for land used for agriculture, where private property is a sensible rule, but not for land used to hunt large animals across, where it is not.
I discuss the general issue of the relative advantages of property and commons in some detail in my Law's Order, although I don't say much about other alternatives.

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