Surowiecki on the "anticommons problem" -- The Gridlock Economy reviewed

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42 Responses to “Surowiecki on the "anticommons problem" -- The Gridlock Economy reviewed”

  1. Baldhead says:

    Bardfinn- your Hoover Dam example doesn’t explain how BC Hydro up in Canada sells rather large amounts of electricity to California.

    Also a better example than the grazing cattle analogy- fishing. Over in Newfoundland fishing almost collapsed from over- fishing. And reason was simple. A fisherman has two sons, who also become fishermen, they each have two sons, who also become fishermen, they, along with having two sons each, build bigger boats able to catch more fish…. the amount of fish coming out of the ocean will eventually exceed the amount being born, and that problem gets increasingly worse every generation of fish.

    So that’s the problem of commons- same size common item, but usually the number of common users increases (especially if seen to be profitable) and eventually chokes things.

    And the hip hop sampling analogy works as well for the opposite argument. We’ll never see another Paul’s Boutique because that album had an average of ten samples a song, with some going over twenty. try clearing all of that and making a profit.

    Using that scheme even George Clinton’s proto- creative commons plan (ask for clearance, we’ll give it, for a percentage of profits only. you make nothing we make nothing) becomes hard to do.

  2. zuzu says:

    The idea of everyone owning their own home is a nice, rather modern concept, and it’s part of many people’s reality. But that expectation, that social norm if you will, has led to an huge financial debacle.

    Sort of. The economic distortions, principally in artificially low interest rates (derived from the fact that interest rates are dictated ad hoc by a central planning organization — the Federal Reserve) and tax incentives biased in favor of homeownership (neglecting opportunity cost), are part of what led to financial debacle.

    Though the “mortgage crisis” and “liquidity crisis” are actually red herrings compared to the source problem of an inflationary crisis — a dysfunctional system pushed past its breaking point by extreme malfeasance to finance the wars in Iraq, Afghanistan, and on “terror”. These are how the “disease” presents itself, but the cause of the “disease” is the monetary authority and fractional reserve banking — which are synonymous with a monetary monopoly.

    Currency competition / complimentary currencies are one way out of this economic quagmire. (c.f. The Denationalization of Money by F.A. Hayek)

  3. Vanderath says:

    BS detection does work for non-hard science subjects – I lost track of how many of my history exams had the question “Where is the Bias in Evidence extract A”…

    Not “is evidence A biased?” you’ll note. that is indeed pretty much assumed.

    and wikipedia? Poor evidence source, always verify.

  4. mdhatter says:

    I wonder if the commons grazing actually work well up to a certain population density, and then breaks down rapidly.

    Well, there is “Boston Common”, where sheep were grazed until about 100 years ago. Since then it’s been a large park in the middle of the city. The “public garden” next to it is similarly a public park.

  5. alowishus says:

    @ ZUZU, specifically #26:

    Finite and Infinite Games. Interesting and definitely worth reading. Read the Wiki entry and thought, “The Internet is a wonderful opportunity for infinite players to muck about with the rules, by, say, flooding blogs with comments referencing Wikipedia posts that they’ve authored.”

    You see, everyone implicitly trusts Wikipedia and it would be very easy for a smart and resourceful person with a lot of time on their hands to craft entries that would slip past Wiki editors. Not entirely false, but just slightly massaged and skewed to support his/her own beliefs and theories.

  6. zuzu says:

    Allow me to introduce you to WikiScanner, or to WikiWatcher.

    Check out the presentation from The Last HOPE: PDF & MP3

    Not only the world’s largest text-based MMO, Wikipedia is a staple of the Internet user’s information diet. Because of this, Wikipedia is also laden with manipulation, forgery, and the downright unscrupulous. In a never before seen presentation, Virgil will mine deep into the bowels of Wikipedia to unearth nefarious deeds whose perpetrators never thought would see the light of day.New software will be released at this talk.

    Simply put, that criticism you cited against the reliability of Wikipedia is now void.

  7. Takuan says:

    ?

    ALL “reference material” is massaged and skewed. This is why liberal arts education exists. That,coupled with a rigorous scientific method is what you call a “bullshit detector”. Well,that and some experience.

  8. Super Nate says:

    The tragedy of the commons is why I studied economics in college. My roommate and I had the problem that 2lbs packs of pastrami only lasted us 2 days in the fridge. The problem was solved and the pastrami lasted two weeks when we started labeling the single pound bags with one of our names. A few days later in class we discussed the tragedy of the commons and I found my major.

  9. codesuidae says:

    the amount of fish coming out of the ocean will eventually exceed the amount being born

    As an aside, also notice that the harvest is selective. Large, robust and fast-growing fish are caught in the nets more often than smaller, weaker, slower-growing fish. By constantly harvesting the robust population the weaker, less robust fish are left to breed.

    The result is that the population becomes progressively weaker and can take much longer to rebound even after over-fishing is stopped.

  10. Vanderath says:

    There’s a flaw in the grazing field analogy: I’m pretty sure the old system of a common pasture was scrapped (in the uk at least) not because it didn’t work, but because of rampant self interest on the part of the Lords of the Manor who arranged for the passing of Enclosures acts which they could afford but the small landowners and tenant farmers couldn’t.
    Up to that point, the Common grazing pasture thing worked pretty well because the farmers ensured that the common was Huge. After the acts were passed, of course, the commons were much smaller, as a lot of the common ground had been parceled in with the regular farmland of the manor.

  11. Takuan says:

    tell your grandchildren what tuna and salmon tasted like.

  12. Anonymous says:

    We all love amazon – but here is a link to the authors site, including an excerpt and a range of place to buy it.

    http://www.gridlockeconomy.com/homepage.html

  13. spazzm says:

    I wonder if the commons grazing actually work well up to a certain population density, and then breaks down rapidly. What would be the analogue for the ‘anti-commons’?

  14. JG says:

    The problem with Capitalism is that it’s leads to ‘Rampant Capitalism’. A state where the notion of free enterprise and a communities best interest is subverted to the few capable of acquiring the most capital thus shutting out diverese individuals with innovations.
    In affect creating the feudal system all over again where the many work for the advancements of the few.

    It evolves into a situation where work is given to the lowest bidders and the system sags under it’s own neglect and entropy.

    For further insights review the American economy in the mid to late 20th century.

    Now brush up on your Spanish, Hindi/Urdu and Mandarin and start sending out those resume!

  15. sabik says:

    Hmm, it seems to me that the problem is not so much ownership as monopoly rights.

    If you own something I need for my project, but I can get it from any number of other places, you’ll sell it to me for fair market price (or someone else will). If you own something I need for my project, and I can’t get it elsewhere, you’ll charge monopoly rents.

    So, if the government grants too many monopolies, we get market failures.

  16. Jeff says:

    They tasted like cat food…but in a good way.

  17. zuzu says:

    So, if the government grants too many monopolies, we get market failures.

    That’s called government failure, namely rent seeking.

    The problem isn’t really ownership, but rather those government-granted monopolies of copyright and patent. This rehashes the topics of small markets (imperfect competition) and asset specificity.

  18. JG says:

    #37 Takuan- I couldn’t agree more.

  19. ACopyrightID says:

    Any good recommendations for books that demonstrate the reasons that Commons (grazing, parks, squares, books, music, etc) are great and necessary.

    I personally think copyright walls off great swathes of possible culture and research; but copyleft does protect the GPLed code commons so…

    Any discussion groups, reading lists, links welcomed.

    How is the Zelda play doing? I see the doubled up letters in the Character names – is this for avoidance of suit?. Counterculture and Piracy, right on. ‘Good artists copy. Great artists steal.’ (Picasso?)

    http://www.scribd.com/doc/3193084/The-Pirates-Dilemma
    (haven’t read this yet).

    Anyone remember the free many chaptered book Cory linked a couple years back which mentionted NWA’s Straight Outta Compton as the last wall of sound now impossible because of sample licensing fees, also had chapters on patents restricting medical research? Was Ken someone I think.

    I also would like to propose a voluntary minute of respectful silence on Speak like a Pir8 day for all those doing time for liberating/ distributing culture and code.

  20. zuzu says:

    The problem with Capitalism is that it’s leads to ‘Rampant Capitalism’. A state where the notion of free enterprise and a communities best interest is subverted to the few capable of acquiring the most capital thus shutting out diverese individuals with innovations.
    In affect creating the feudal system all over again where the many work for the advancements of the few.

    This characterization seems to assume that economic resources are zero-sum. Not true.

    Economic activity is an open-system, and “pure capitalism” necessarily favors growth (i.e. return on investment) because of the both-benefit requirement of voluntary trade.

    c.f. Finite and Infinite Games by James P. Carse (MP3)

    p.s. Regarding the Tragedy of the Commons, check out The Problem of Social Cost by Ronald Coase, which laid the foundation for the Coase Theorem. (I’m pretty sure this, and most of the “macro”-economic principles I consider valuable — such as Friedrich A. Hayek’s Use of Knowledge in Society / spontaneous order, Herbert A. Simon’s bounded-rationality, Daniel Kahneman’s behavioral finance, Duncan Black’s public choice theory, Ronald Coase / Oliver E. Williamson’s transaction costs, and the principal-angent problem — all got some mention in James Surowiecki’s The Wisdom of Crowds. I was quite impressed by his treatment of the subject for a popular audience.)

  21. PaulR says:

    There’s a wonderful example of the tragedy of the anticommons. “Waking Ned Devine”.
    http://www.youtube.com/watch?v=osmPlQXzXXA

    “Pig Finn: Come on, Maggie!
    Maggie O’Toole: I caught a whiff of something then.
    Pig Finn: Oh no, it’s peaches. Peach soaps, Maggie.
    Maggie O’Toole: Oh no. It’s something else.
    Pig Finn: Could be strawberries. Oh, Maggie.
    Maggie O’Toole: Finn.
    Pig Finn: Maggie.
    Maggie O’Toole: Finn. Oh no, sorry love, it’s still there.”

    Find a good friend, curl up with a dram of whiskey (can I suggest The Macallan, Mordecai Richler’s tipple of choice?) and be transported to a better place.

  22. Philbert says:

    Here http://www.slate.com/id/2195158/ is a review of this book from a month ago.
    Apparently Cory missed this in his mailbox as I sent this link to him.

  23. alowishus says:

    @ZUZU: It wasn’t a criticism about Wikipedia . . . It was more an observation. I imagine a poster saying something like this: “I’m right, look at this,” and then citing something they wrote or tweaked as evidence. I didn’t go beyond that thought at all. Anything else you inferred was cooked up in your own head.

  24. JG says:

    # 26-”Economic activity is an open-system, and “pure capitalism” necessarily favors growth (i.e. return on investment) because of the both-benefit requirement of voluntary trade.”

    True in theory but not in practice.
    That’s really the difference between ‘Free Enterprise’ and ‘Rampant/Hyper Capitalism’.

    And we can’t wait for a generation or two for the system to right itself.

  25. zuzu says:

    True in theory but not in practice.
    That’s really the difference between ‘Free Enterprise’ and ‘Rampant/Hyper Capitalism’.

    Well… do you have a theory to account for the discrepancy?

    Can you explain it deductively and positively?

  26. frankiez says:

    Capitalism has been successful cause it solved the problems of (anticommons) feudalism/Landed property?
    Rave culture blossomed with commons (free sampling) and now is slowing cause the Music industry expecting copyright fees also for small run records…
    Street culture has always sampled from popular products if you start to charge underground creators you get some money soon but loose the long time revenues that come from undeground promotion…

    Commons temple is the Tokyo Big Sight’s COMIKET (starts this friday) with over 500.000 people shopping for user made comics, videogames and goods… In the last 10 yers I saw so many anime/manga getting new life and exposure (= new money for the copyright holders) trough the doujin (not licensed) products!

    I live in a country (ITALY) where anticommons is dominant so there is anything new/revolutionary created in the last 20 years. Commons applied in the right way can be a GREAT boost for capitalism and society….

    @ Philbert: I imagine Cory got a constant stream of submissions so it’s pretty easy to miss something.

  27. Jeff says:

    JG, we’ll have to wait for whatever happens. As we always have. Granted, we can make things happen faster when we have a pretty firm goal in mind (such as getting to the Moon), but generally our economic process is organic and is just as likely to evolve based on irrational human desire as it is on human rational speculation. Wealth is power, after all, and you can’t expect people to give up their power. As a species we are very inclined to understand the pecking order. Most of the really powerful people enjoy being on top. Go figure. If it’s not money that makes and keeps people powerful then it will be something else.

  28. bardfinn says:

    Correction:

    Wind Power could reliably support up to twenty percent of America’s energy needs, but the wind is not where the energy use is, and the energy use is not where the wind is, AND, importantly: electricity does not transmit efficiently over very long distances over wire. The losses negate the economic benefits of harvesting wind.

    If wind could, at present, reliably power twenty percent of America, then massive solar farms in the American Southwest, as well as hydroelectric dams, could power a massive percentage; Instead, Hoover Dam powers just Vegas, Nevada, and Area 51, because the electricity can’t get efficiently into California, much less anywhere else.

    The windmills, not the transmission lines, are the relevant NIMBY syndrome catalyst: For New England Democrats, they would spoil the “pristine vista” from their oceanfront property, for midwesterner Republicans, “The hum would be eerie” / “it would spoil the pristine vistas” – not that these same people can’t / don’t tolerate tornadoes, massive thunderstorms, glaring heat, manure composting, as well as traffic hum, city glow, etcetera.

    The problem is this: There are entirely too many people who stand to profit from implementing or denying specific plans, such as T. Boone Pickens, the oil companies, etcetera – and many of the analysts are in someone’s pocket.

    Until people are free to criticise a proposal reasonably and be heard as making sense, none of the critics are going to be listened to unless they too get money and power behind them.

  29. vonmises says:

    Damn that pesky private property, getting in the way of social engineering and Utopian goals. Hey, whose pastrami is this? Oh well, to each according to need, right?

  30. bardfinn says:

    I think “Hey, whose pastrami is this?” should become a catchphrase.

  31. JG says:

    Jeff, well put.

    ZuZu, see #24 above.

    No one has all of the answers but it’s easy to see that the system has failed many Americans.

  32. zuzu says:

    ZuZu, see #24 above. No one has all of the answers but it’s easy to see that the system has failed many Americans.

    But you can’t explain why it failed. I think that amounts to an argument from ignorance.

    If you’re talking about the recent economic failures, that’s actually more than adequately explained by the business cycle — which are caused by the misallocation of the rate of interest (either too high or too low — usually too low) set by fiat (rather than by localized feedback) by the central bank (i.e. Federal Reserve) who controls the money supply through government-granted monopoly.

    Simply put, true to his “crossing the line from everyday villainy to cartoonish super-villainy” motif, George W. Bush appointed Ben Bernanke to chair the Fed because Bernanke’s whole thesis is based on the presumption that (basically) “inflation isn’t a problem” — just the kind of crony you want to allow you to debase the currency to fund your foreign military campaigns and domestic “enabling acts”. I hate to invoke Godwin, but this is plainly lifted from the Nazi playbook. Hell, there was even a Hogan’s Heroes episode that echoed the historical fact of the Third Reich printing money to cover its fascist debts.

  33. Super Nate says:

    I see another thread devolving into the old capitalism good or bad argument.

    The theory of the anti-commons is specifically a diverse group all sharing veto-rights to any use of a resource. Examples prevalent not just in copyright law but is the basis for things like snob zoning laws. Residents of a community organizing to block development of land that is not titled to them to keep the “undesirables” out. It is also an interpretation of historical landmark designations that block other uses of land. In copyright, its the rights holders of soundtracks that keep dvds of great tv shows from the 70′s off the shelves.

  34. frankiez says:

    “Damn that pesky private property, getting in the way of social engineering and Utopian goals. Hey, whose pastrami is this? Oh well, to each according to need, right?”

    Maybe if you take a couple of minutes to click around the net you will discover that also capitalism/private property concept is evolving or why we would discuss things like DRM?!

    Reality is a little bit more complex than: “This is mine and you can’t touch it because we live in the USA where the private property is GOD”…

  35. vonmises says:

    #13,

    If you are trying to say that “intellectual” property is a different animal than actual (physical) property, and that the differences between the two with regard to such things as scarcity and exclusive use should entail a different approach to “rights” talk, then I agree. But don’t mistake a realization of that with “evolving” (ie, weakening) actual private property rights. That’s all I’m sayin’, bro – stop eating my pastrami.

  36. Jeff says:

    How would we define civilizations such as the Roman Empire or Imperial China or perhaps the Egyptians? Granted, there were different qualities to these civilizations with regard to specifics, but one thing they all held in common was that ownership and control of assets was controlled by a minority. Rome held on for a good long time, as did the Chinese as well as Egyptian dynastic system. I guess that’s an argument for the limitation of ownership by just a very few. And it depends on how you want to define a civilization’s successes. The idea of everyone owning their own home is a nice, rather modern concept, and it’s part of many people’s reality. But that expectation, that social norm if you will, has led to an huge financial debacle.

  37. JG says:

    The system is failing ( and has failed time and again) because the main goal is to acquire capital without regard to long term impact.
    If you were half as astute as you are a myopic reactionary you’d see that.
    But I’d never stoop to calling your comments as being based on ignorance.
    Just more on wishful thinking.

    BTW how is the Kool-Aid?

  38. eric orchard says:

    Interesting to me how this all echoes the Victorian problems of wealth and land distribution. The rhetoric reminds me of Chesterton’s and Belloc’s advocation of distributionism, a series of checks and balances to ensure neither capitalism nor socialism overwhelms the economy by limiting ownership of properties. This system has been in use for some time in Antigonish, Nova Scotia. Either way the goal is to stop very few people from owning too much.

  39. Jeff says:

    Takuan, if only the Bullshit Detector could give good results for anything other than hard science. And even then it’s a little off. For instance, there is a new-ish idea that the speed of light is not (C) but (V) as in Variable. Now, if that’s true our current understanding of the Universe is in question. God may in fact have adjusted the speed limit just for kicks.

  40. Burz says:

    @Zuzu #28 -

    Ecology accounts for the discrepancy between capitalist theory and reality. In terms of accounting for resource use and long term viability, ecology has superseded economics for years now and will probably continue to do so.

    Capitalism has a built-in expectation of continuing frontiers combined with resource scarcity (odd, that). When physical frontiers run dry, then intangibles become marked for a process of settlement/enclosure. But science shows us that such an economic culture is an ADD-inducing consumer nightmare.

  41. Anonymous says:

    #2 – you’re right. The “tragedy of the commons” (as it’s used by historians) refers not to resource mis-use by individualistic shepherds, but to the Enclosure Act and the removal of prime grazing land from common access.

    The end result is pretty much the same as the “Gridlock Effect,” though. Valuable resources go under-utilized (ie former Commons land becomes romantic vista for local landed gentry), and are inaccessible to the people who a) need the resources to make a living, and b) know how to use those resources sustainable.

  42. zuzu says:

    Examples prevalent not just in copyright law but is the basis for things like snob zoning laws. Residents of a community organizing to block development of land that is not titled to them to keep the “undesirables” out.

    Zoning laws are another huge problem, and have completely undermined the nuisance tort, which is how companies such as GE get government permits to dump PCBs in the Hudson river (as it was zoned as an “industrial river”) and no one owning property downstream of the river could sue for damages, because the government permit provided legal amnesty. c.f. tort reform for an expansion of that legal protectionism

    Also, c.f. green libertarianism, free-market environmentalism, PERC

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