Re: poly: Modeling Economic Singularities

>But even with property rights (i.e. patents), the typical investor
>who sets out to develop a new product can't expect a return
>substantially above the market return, can he? As you say:"while one
>group now has the right to make the next Batman movie sequel, there
>have long been open contests to create popular movie series, and
>popular comic strips."

Yes, partial property rights are not enough to escape the racing problem.
But partial property rights can narrow the difference between private
and social return.

>Are you saying that in addition to this effect there is another effect,
>namely that property rights prevent investors from engaging in a race
>to first in which they burn up excess returns?

Yes, but the degree of property rights required to have this effect
is very strong, and unlikely to be seen anytime soon.

>If so, are these wasted excess returns only their private returns, or
>does it adversly affect society as a whole.

It should adversely affect society as a whole, if, as seems plausible,
the social return is some factor times the private return.

Robin Hanson
hanson@econ.berkeley.edu http://hanson.berkeley.edu/
RWJF Health Policy Scholar, Sch. of Public Health 510-643-1884
140 Warren Hall, UC Berkeley, CA 94720-7360 FAX: 510-643-8614
Received on Wed Apr 22 17:53:10 1998