Re: the economics of transition to nanotech

From: Robert Bradbury (
Date: Wed Jan 12 2000 - 06:35:30 MST

On Tue, 11 Jan 2000, Eliezer S. Yudkowsky wrote:

> Robin Hanson wrote:
> >
> > On 1/7/2000 Damien Broderick wrote:
> > >I'm happy to stick by some of what I wrote
> > >(eg, that we might end up with a gift economy if assemblers prove cheap and
> > >tractable), but the vexing issue is the realistic pathway there.
> >
> > The stability and plausibility of a nano-gift economy seems to me to be
> > much more questionable. *If* such an economy made sense, I don't find
> > it hard to imagine industry developing the technologies that make it possible.
> If a nano-gift economy evolves, it will be because open-source nanotech
> outcompetes proprietary nanotech, an outcome I find easy to imagine. As
> Eric S. Raymond points out at considerable length, especially in the
> truly excellent _The Magic Cauldron_, the best reasons for open-source
> have nothing to do with altruism. Open-source code develops faster and
> works better. Who wants to buy a clunky private spacewagon when they
> can get a much more reliable one for free?

Eliezer, while I applaud Eric and Open Source in general, as a programmer
I must simply tell you that Open Source *does* have limitations. If
the complexity is too great, or the underlying architecture too poor
or the number of people trying to simultaneously modify the same code
too large (requiring someone to interpret the spagetti that results),
then open-source may not be faster, nor work better. This comes down
to a fundamental problem that one programmer of the 100 lines of debugged
code per day type is worth a lot more than 10 programmers of the 10 lines
per day type. Anyone who has worked on truely large software projects
knows this to be true. What makes software much better today and allows
things like open-source to work is that we have built up the tool base
so that we have programs to do the stupid stuff (like merging single
line changes with no conflicts into open source) and better tools
(perl + lots others), that make the 100 line/day programmers produce
100 lines of much more productive code.

Now, returning to Damien's & Robin's discussion about nano-gift economies.
It *is* useful to look at combined government/philanthropic efforts and
the industry sub-base that develops around those efforts. In particular
I am thinking of all the research funded by NIH (~$17 billion/yr now).
Most of this research is only "profitable" on time scales much longer
than those that would be considered by industry. Yet, all of the money
going into thousands of ideas proposed by individual researchers and
approved by grant committees, does end up producing an "industry" of
organizations (who actually make money), supplying the chemicals,
reagents, instruments, etc. to do that research.

I look at NASA (where the initial motivation was largely political) or
say the high-energy Physics community (where the interest was partially
military and partially pure science) and how they have "suffered" over
the last ~20 years and contrast that with NIH (where the politicians are
falling all over themselves to throw money at them). The major difference
I see is the concrete personal benefits people see from the trickle-down
effects of the NIH research. One drug like Viagra (where the underlying
science was funded by the NIH) is worth as much as a moon landing and there
will be dozens of Viagras. Another model worth considering is funding for
vaccine development. BigPharma "generally" doesn't like vaccines because they
usually don't have high repeat sales. So the government has to contract
with BigPharma to produce the vaccines, or philanthropies like the
Gates Foundation have to get into the game.

So, I think you might want to examine what will happen if the public
at large, or a core group of scientists with political throw weight (e.g.
the human genome project), or the Rockefeller/Gates/Ellison/etc.
foundations get really "convinced" that nanotech is going to provide
*huge* personal benefits. The human genome project is a case in
point, because you get people like HGS/Incyte/Celera developing
ways to try and turn patents or database information into ROI and
working really hard to run faster than the public researchers & government.

You also want to look at the billions in VC money now available that
has to go someplace. I think the Internet/eBusiness trend should play
out in a few years. At that point the trend has to swing back to
either Biotech or Nanotech.


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