From: Hal Finney (hal@finney.org)
Date: Tue Mar 11 2003 - 00:49:07 MST
Wei writes:
> Speaking of alternative approaches to handling intellectual property,
> here's a proposal I made on another mailing list:
>
> http://www.weidai.com/measuring.txt
>
> and some follow up discussion with Robin Hanson:
>
> armchair@gmu.edu/msg02481.html">http://www.mail-archive.com/armchair@gmu.edu/msg02481.html
I'll quote the first part of the first link above:
: I think we should consider funding information goods (software, movies,
: music, etc.) through tax revenue rather than copyrights. (Those rights are
: increasingly difficult to enforce and produce much waste by causing
: information goods to be priced far above marginal costs.) One way to do it
: would be to let people spend their own money to produce the information,
: and then reimburse them based on some function of the expended cost and
: the social benefit.
Wei goes on to propose a way to derive the value of a particular
information good, which is basically to ask a small sampling of users
in such a way that they have an incentive to answer honestly.
In a way what you are suggesting is that information be treated as a
public good. Then the question is a special case of the question of
how to find the right level of funding public goods. However it is a
particularly difficult case because every piece of information is unique
and has its own value, to a vastly greater degree than traditional public
goods like highways or dams.
Nevertheless I wonder if the economics literature on public goods could
provide some insight and tools that could be applied to this case.
I have (temporarily) put a copy of what I think is a seminal paper
on this topic, The Optimal Allocation of Public Goods, by Groves and
Ledyard, on my web site at http://www.finney.org/~hal/GrovesLedyard.pdf.
For more information, a site with many good links to papers on public
goods (towards the bottom of the page) is
http://www.econ.ucsb.edu/~tedb/econ230b.html.
The Groves and Ledyard paper falls under the category of "incentive
compatible" mechanisms, where the goal is basically to get people to
voluntarily tell the truth about how much things are worth to them.
Your approach accomplishes this as well, in a much simpler and more
practical way. It's hard to imagine a Groves and Ledyard voting system
where every voter must give his estimate of the value of every single
movie, song, program and written work ever created. For reference here
is Wei's idea:
: Whenever someone first accesses a piece of information, he may be chosen
: by the access mechanism randomly, with probability p1, to answer whether
: he values that information more than some random amount of money $x. Then
: with probability p2, if he answers yes, he is charged $x, otherwise he is
: denied access to this piece of information forever. p1 and p2 are both
: supposed to be small. In the usual case, he would just be allowed to
: access the information for free.
It does seem kind of unjust, some poor guy is going to download a song,
and the system asks him, is this song worth $1000 to you? And he says
no, and then it says that he can never listen to that song again for the
rest of his life. Granted this would be very uncommon, but it can't be
too uncommon or the system can't generate the necessary statistics.
Doesn't this proposal also require that we know not only how much each
piece of information is worth, but also how widely it is shared? So all
information would be downloaded from some centralized locations that kept
track of the number of downloads in addition to doing the cost analysis
above. As you say, this gives people little incentive to pirate the data,
since almost all the time they can get whatever they want for free.
Nevertheless I wonder if some other incentive compatible mechanism
could be devised which would let people share data directly, and avoid
this sort of blacklist effect where a few unlucky people are shut out
from particular works. Maybe consumers could vote in some way for
their favorite pieces of information, and direct the tax revenues to
the creators. This might also allow people to vote after sampling the
product rather than beforehand, which would give a more accurate estimate
of the value.
Maybe you could use a Groves and Ledyard mechanism to set the value of the
total pool of money to be disbursed to information creators, and then a
simpler voting system like this could control how the money is divided.
People would have an incentive in the voting to be reasonably accurate
since they would want more money to go to the creators of information
that they value. And they would only need to vote for the specific
information goods they had found valuable in the recent past, so with
some computer aid it might be a practical system.
Hal
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