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The Coming Battle over Intellectual Property

April 16, 2012

Historically, agriculture and manufacturing both relied on large scale employment to be productive, but with the advent of massive computerized automation, that is less and less the case every day. Jobs are continually being displaced by computers and robots, and Moore’s law implies that this trend will only accelerate. In another decade, a cellphone sized device will be able to beat humans in a wide variety of tasks that few people use computers for today. Already, computers can grade essays, win Jeopardy, translate languages in real time, perform routine legal processes, and diagnose patients. And this is just the beginning. In times of such lightning fast innovation, intellectual property rights have a massive impact on how the economy develops. An inventor can hold up the innovation process for 20 years while earning obscene amounts of money and crippling technological progress. In a world with fewer and fewer opportunities for the common man to be productive economically, will people accept politically an elite few making so much in the “winner take all” intellectual property markets?

Remember that production consists of 2 inputs: natural resources and human effort, which includes efforts to increase the technology level and spread knowledge. In the ancient world, most economic power accrued to those with large amounts of natural resources, and I think it is likely that the post-singularity world will as well. But today, most economic power is held by workers. However, economic power is transitioning from the masses, who do repetitive and low skilled work, to the elite, who are highly trained and in possession of rare skills. The winner take all model requires that goods can be easily copied and distributed widely. An athlete can earn millions, by entertaining tens of millions of people, despite only being perhaps 5% better than the next best competition. An inventor can earn millions by making a slightly better phone or website. The linchpin of the winner take all outcomes in our current society is intellectual monopoly. By eliminating it, economic power would flow away from the elites to the plebs. The best workers would still earn above average returns, but they could not gain the scale required to earn as much as they do today. Intellectual monopolists will look like a very tempting political target for populists. Already, cracks are beginning to appear in the IP enforcement mechanisms. It seems like only a matter of time before a foreign country abolishes intellectual property rights, allowing them to consume freely the fruits of everyone’s technology (and possibly speeding their own advancement) or a populist U.S. politician uses the huge potential gains to the masses to abolish intellectual monopoly here. Pirates of the world unite!

2 Comments leave one →
  1. zephistopheles permalink
    April 16, 2012 7:49 pm

    So say we all!


  1. After Copyright « azmytheconomics

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