Business Methods Patents - Rensselaer Hartford Campus

advertisement

Earlier Version Presented to EEA Law & Econ. Workshop, NYC, Feb 28, 2009

James Stodder, (Ph.D., Economics, Yale 1990)

Lally School of Management & Technology

Rensselaer Polytechnic Institute at Hartford

Hartford, Connecticut, USA

1

“The Nature of the Firm,” Economica, 1937

- Firms exist to minimize “transaction costs”

“The Problem of Social Cost,”

Journal of Law and Economics, 1960

- Property Rights evolve to allocate property when transaction costs are too high

2

The Common Law is “an attempt to increase the value of the resource by assigning property rights to those parties … in whose hands the rights are most valuable.”

- Richard Posner, The Economic Analysis of the Law, 1972

Without flexible property rights, “the only way we thought we could test out the value of the pollution was by the only liability law we thought we had.”

- Guido Calabresi and Douglas Melamed, “Property

Rules, Liability Rules, and Inalienability”, Harvard Law Review, 1992

3

Now we have “Coase’s Penguin, or Linux and

The Nature of the Firm” by Yochai Benkler (Harvard) http://www.yalelawjournal.org/the-yale-law-journal/article/coase%27spenguin,-or,-linux-and-the-nature-of-the-firm/

4

Firefox

Linux

Wikipedia

Apache WebServer

MIT Open CourseWare

Google

EBay

Apple

Amazon

MySQL (Sun)

Travelocity

5

http://en.wikipedia.org/wiki/Copyleft

6

Copyright Creative Commons Public Domain http://creativecommons.org/

7

Dual Licensing (MySQL)

Attribution (96% of licenses)

Attribution + No-Derivatives

8

Table 1: Ideal Organizational Forms as a

Function of Transaction and System Costs

SYSTEM COSTS (from

TRANSACTION Implementation)

EFFECIENCY (Operational)

MARKET EXCHANGE

> Coordination or Peering

COORDINATION

> Peering or Market Exchange

PEERING

> Market Exchange or Coordination

INCENTIVE GAINS for Private Property >

IMPLEMENTATION COSTS for Private Property >

Implementation Costs

Markets

Incentive Gains

Public Goods

(Stock, Commodity, Books) (Roads, Police, Ideas)

Firms Club Goods

(Automobiles; Shoes) (Swiss Pastures, Schools)

Private ‘ open source ’ Peer Production

(Google, Faculty) (Clickworkers, Wikis)

9

Information Problems in

Pervasively Networked Environments (PNEs):

1. Accounting – Multiplicity of information, many kinds and sources.

2. Cooperation / Coordination – ‘Publicness’ of Consumption and Production. Important externalities (+/-) are public (Coase).

3. Complexity – Fundamental Non-Convexity of Negative Externalities (Starrett).

10

Table 2: Ideal Forms as function of Major

Informational and Organizational Problems

INFOR-

ORGANIZATION

PROBLEM

MATION PROBLEM

ACCOUNTING

> Cooperation or

Non-Convexity

COOPERATION

> Non-Convexity or

Accounting

NON-CONVEXITY

> Accounting or

Cooperation

INCENTIVIZE COORDINATE COOPERATE

Money, Power, Status,

Power Money Money

Markets

(Stock, Commodity,

Books)

Public Good

(Roads,

Environment)

Commons

(Public Radio,

Ideas)

Firms

(Automobiles,

Shoes)

Patents

(Drugs, Microsoft,

Biz Methods)

Teams

(Police, Military,

Research)

‘Open Source’

(Google, Faculty,

Artist)

Club Goods

(Swiss Pastures,

Students)

Peering

( Clickworkers ,

Wikis)

11

Non-Convexity & Reversibility

12

Total , not just Marginal Conditions

13

'Pinwheel'

+ 0.75

My Firm

+ 1.00

+ 0.75

+ 0.50

+ 0.50

+ 0.25

+ 0.25

+ 0.00

- 0.25

+ 0.00

- 0.50

- 0.75

- 1.00

- 0.75

- 0.50

- 0.25

14

• US v. Europe

• Google v. Yahoo

Linux v. Microsoft

• Apple v. Microsoft

Guerilla Bands v. Central. Army

15

Agriculture => Manor, Plantation

• Feudalism

Industry => Family Firm, Corporation

• Capitalism

Research => Scientific Circles, Universities, Firms

• New Forms of IP

The Economist, “The Next Society,” November 2001

16

“ As the flow of water is determined by the earth , so the victory of military force is determined by the opponent.

Military force has no constant formation, as water has no constant shape.

To gain victory by changing and adapting to the opponent is called genius.

- Sun-Tzu, The Art of War, 500 B.C.

“… the great uncertainty of all data in war is a peculiar difficulty, because all action must …be planned in a mere twilight, which like the effect of a fog or

moonshine — gives to things exaggerated dimensions and an unnatural appearance. What this feeble light leaves indistinct to the sight, talent must discover , or must be left to chance.”

- Von Clausewitz, On War, 1874

17

Download