Notes

Notes
CHAPTER 1. Introduction: A Moment of Opportunity and Challenge
1. Barry Wellman et al., “The Social Affordances of the Internet for Networked Individ
ualism,” JCMC 8, no. 3 (April 2003).
2. Langdon Winner, ed., “Do Artifacts Have Politics?” in The Whale and The Reactor: A
Search for Limits in an Age of High Technology (Chicago: University of Chicago Press,
1986), 19–39.
3. Harold Innis, The Bias of Communication (Toronto: University of Toronto Press, 1951).
Innis too is often lumped with McLuhan and Walter Ong as a technological deter
minist. His work was, however, one of a political economist, and he emphasized the
relationship between technology and economic and social organization, much more
than the deterministic operation of technology on human cognition and capability.
4. Lawrence Lessig, Code and Other Laws of Cyberspace (New York: Basic Books, 1999).
5. Manuel Castells, The Rise of Networked Society (Cambridge, MA, and Oxford: Blackwell
Publishers, 1996).
PART I. The Networked Information Economy
1. Elizabeth Eisenstein, Printing Press	as	an	Agent of Change (Cambridge: Cambridge		?1
University Press, 1979).					0
					?1
				475

476	Notes to Pages 36–46
	CHAPTER 2. Some Basic Economics of Information Production and Innovation
	1. The full statement was: “[A]ny information obtained, say a new method of produc
	tion, should, from the welfare point of view, be available free of charge (apart from
	the costs of transmitting information). This insures optimal utilization of the infor
	mation but of course provides	no	incentive for investment in research. In a free
	enterprise economy, inventive activity is supported by using the invention to create
	property rights; precisely to the extent that it is successful, there is an underutilization
	of information.” Kenneth Arrow, “Economic Welfare and the Allocation of Resources
	for Invention,” in Rate and Direction of Inventive Activity: Economic and Social Factors,
	ed. Richard R. Nelson (Princeton, NJ: Princeton University Press, 1962), 616–617.
	2. Suzanne Scotchmer, “Standing on the Shoulders of Giants: Cumulative Research and
	the Patent Law,” Journal of Economic Perspectives 5 (1991): 29–41.
	3. Eldred v. Ashcroft, 537 U.S. 186 (2003).
	4. Adam Jaffe, “The U.S. Patent System in Transition: Policy Innovation and the In
	novation Process,” Research Policy 29 (2000): 531.
	5. Josh Lerner, “Patent Protection and Innovation Over 150 Years” (working paper no.
	8977, National Bureau of Economic Research, Cambridge, MA, 2002).
	6. At most, a “hot news” exception on the model of International News Service v. As
	sociated Press, 248 U.S. 215 (1918), might be required. Even that, however, would only
	be applicable to online editions that are for pay. In paper, habits of reading, accred
	itation of the original paper, and first-to-market advantages of even a few hours would
	be enough. Online, where the first-to-market advantage could shrink to seconds, “hot
	news” protection may be worthwhile. However, almost all papers are available for free
	and rely solely on advertising. The benefits of reading a copied version are, at that
	point, practically insignificant to the reader.
	7. Wesley Cohen, R. Nelson, and J. Walsh, “Protecting Their Intellectual Assets: Ap
	propriability Conditions and Why U.S. Manufacturing Firms Patent (or Not)” (work
	ing paper no. 7552, National Bureau Economic Research, Cambridge, MA, 2000);
	Richard Levin et al., “Appropriating the Returns from Industrial Research and De-
	velopment”Brookings Papers on Economic Activity 3 (1987): 783; Mansfield et al., “Im
	itation Costs and Patents: An Empirical Study,” The Economic Journal 91 (1981): 907.
	8. In the 2002 Economic Census, compare NAICS categories 5415 (computer systems
	and related services) to NAICS 5112 (software publishing). Between the 1997 Economic
	Census and the 2002 census, this ratio remained stable, at about 36 percent in 1997
	and 37 percent in 2002. See 2002 Economic Census, “Industry Series, Information,
	Software Publishers, and Computer Systems, Design and Related Services” (Wash
	ington, DC: U.S. Census Bureau, 2004).
	9. Levin et al., “Appropriating the Returns,” 794–796 (secrecy, lead time, and learning-
	curve advantages regarded as more effective than patents by most firms). See also
	F. M. Scherer, “Learning by Doing and International Trade in Semiconductors” (fac
	ulty research working paper series R94-13, John F. Kennedy School of Government,
	Harvard University, Cambridge, MA, 1994), an empirical study of semiconductor			?1
	industry suggesting that for industries with steep learning curves, investment in in			0
	formation production is driven by advantages of being first down the learning curve			?1

Notes to Pages 47–87					477
rather than the expectation of legal rights of exclusion. The absorption effect is de
scribed in Wesley M. Cohen and Daniel A. Leventhal, “Innovation and Learning:
The Two Faces of R&D,” The Economic Journal 99 (1989): 569–596. The collaboration
effect was initially described in Richard R. Nelson, “The Simple Economics of Basic
Scientific Research,” Journal of Political Economy 67 (June 1959): 297–306. The most
extensive work over the past fifteen years, and the source of the term of learning
networks, has been from Woody Powell on knowledge and learning networks. Iden
tifying the role of markets made concentrated by the limited ability to use informa
tion, rather than through exclusive rights, was made in F. M. Scherer, “Nordhaus’s
Theory of Optimal Patent Life: A Geometric Reinterpretation,” American Economic
Review 62 (1972): 422–427.
10. Eric von Hippel, Democratizing Innovation (Cambridge, MA: MIT Press, 2005).
11. Eben Moglen, “Anarchism Triumphant: Free Software and the Death of Copyright,”
First Monday (1999), http://www.firstmonday.dk/issues/issue4_8/moglen/.
CHAPTER 3. Peer Production and Sharing
1. For an excellent history of the free software movement and of open-source develop
ment, see Glyn Moody, Rebel Code: Inside Linux and the Open Source Revolution (New
York: Perseus Publishing, 2001).
2. Elinor Ostrom, Governing the Commons: The Evolution of Institutions for Collective
Action (Cambridge: Cambridge University Press, 1990).
3. Josh Lerner and Jean Tirole, “The Scope of Open Source Licensing” (Harvard NOM
working paper no. 02–42, table 1, Cambridge, MA, 2002). The figure is computed
out of the data reported in this paper for the number of free software development
projects that Lerner and Tirole identify as having “restrictive” or “very restrictive”
licenses.
4. Netcraft, April	2004	Web	Server	Survey, http://news.netcraft.com/archives/web_
server_survey.html.
5. Clickworkers Results: Crater Marking Activity, July 3, 2001, http://clickworkers.arc
.nasa.gov/documents/crater-marking.pdf.
6. B. Kanefsky, N. G. Barlow, and V. C. Gulick, Can Distributed Volunteers Accom
plish Massive Data Analysis Tasks? http://www.clickworkers.arc.nasa.gov/documents
/abstract.pdf.
7. J. Giles, “Special Report: Internet Encyclopedias Go Head to Head,” Nature, Decem
ber 14, 2005, available at http://www.nature.com/news/2005/051212/full/438900a.html.
8. http://www.techcentralstation.com/111504A.html.
9. Yochai Benkler, “Coase’s Penguin, or Linux and the Nature of the Firm,” Yale Law
Journal 112 (2001): 369.
10. IBM Collaborative User Experience Research Group, History Flows: Results (2003),
http://www.research.ibm.com/history/results.htm.
11. For the full argument, see Yochai Benkler, “Some Economics of Wireless Commu
nications,” Harvard Journal of Law and Technology 16 (2002): 25; and Yochai Benkler,						?1
“Overcoming Agoraphobia: Building the Commons of the Digitally Networked En						0
vironment,” Harvard Journal of Law and Technology 11 (1998): 287. For an excellent						?1

478	Notes to Pages 88–93
	overview of the intellectual history of this debate and a contribution to the institu
	tional design necessary to make space for this change, see Kevin Werbach, “Super
	commons: Towards a Unified Theory of Wireless Communication,” Texas Law Review
	82 (2004): 863. The policy implications of computationally intensive radios using wide
	bands were first raised by George Gilder in “The New Rule of the Wireless,” Forbes
	ASAP, March 29, 1993, and Paul Baran, “Visions of the 21st Century Communica
	tions: Is the Shortage of Radio Spectrum for Broadband Networks of the Future a
	Self Made Problem?” (keynote talk transcript, 8th Annual Conference on Next Gen
	eration Networks, Washington, DC, November 9, 1994). Both statements focused on
	the potential abundance of spectrum, and how it renders “spectrum management”
	obsolete. Eli Noam was the first to point out that, even if one did not buy the idea
	that computationally intensive radios eliminated scarcity, they still rendered spectrum
	property rights obsolete, and enabled instead a fluid, dynamic, real-time market in
	spectrum clearance rights. See Eli Noam, “Taking the Next Step Beyond Spectrum
	Auctions: Open Spectrum Access,” Institute of Electrical and Electronics Engineers Com
	munications Magazine 33, no. 12 (1995): 66–73; later elaborated in Eli Noam, “Spec
	trum	Auction: Yesterday’s Heresy, Today’s Orthodoxy, Tomorrow’s Anachronism.
	Taking the Next Step to Open Spectrum Access,” Journal of Law and Economics 41
	(1998): 765, 778–780. The argument that equipment markets based on a spectrum
	commons, or free access to frequencies, could replace the role planned for markets
	in spectrum property rights with computationally intensive equipment and sophisti
	cated network sharing protocols, and would likely be more efficient even assuming
	that scarcity persists, was made in Benkler, “Overcoming Agoraphobia.” Lawrence
	Lessig, Code and Other Laws of Cyberspace (New York: Basic Books, 1999) and
	Lawrence Lessig, The Future of Ideas: The Fate of the Commons in a Connected World
	(New York: Random House, 2001) developed a rationale based on the innovation
	dynamic in support of the economic value of open wireless networks. David Reed,
	“Comments for FCC Spectrum Task Force on Spectrum Policy,” filed with the Fed
	eral Communications Commission July 10, 2002, crystallized the technical underpin
	nings and limitations of the idea that spectrum can be regarded as property.
	11. See Benkler, “Some Economics,” 44–47. The term “cooperation gain” was developed
	by Reed to describe a somewhat broader concept than “diversity gain” is in multiuser
	information theory.
	12. Spectrum Policy Task Force Report to the Commission (Federal Communications Com
	mission, Washington, DC, 2002); Michael K. Powell, “Broadband Migration III: New
	Directions in Wireless Policy” (Remarks at the Silicon Flatiron Telecommunications
	Program, University of Colorado at Boulder, October 30, 2002).
	CHAPTER 4. The Economics of Social Production
	1. Richard M. Titmuss, The Gift Relationship: From Human Blood to Social Policy (New
	York: Vintage Books, 1971), 94.		?1
	2. Kenneth J. Arrow, “Gifts and Exchanges,” Philosophy & Public Affairs 1 (1972): 343.		0
			?1

Notes to Pages 94–116	479
3. Bruno S. Frey, Not Just for Money: An Economic Theory of Personal Motivation (Brook
field, VT: Edward Elgar, 1997); Bruno S. Frey, Inspiring Economics: Human Motivation
in Political Economy (Northampton, MA: Edward Elgar, 2001), 52–72. An excellent
survey of this literature is Bruno S. Frey and Reto Jegen, “Motivation Crowding
Theory,” Journal of Economic Surveys 15, no. 5 (2001): 589. For a crystallization of the
underlying psychological theory, see Edward L. Deci and Richard M. Ryan, Intrinsic
Motivation and Self-Determination in Human Behavior (New York: Plenum, 1985).
4. Roland Be´nabou and Jean Tirole, “Self-Confidence and Social Interactions” (working
paper no. 7585, National Bureau of Economic Research, Cambridge, MA, March
2000).
5. Truman F. Bewley, “A Depressed Labor Market as Explained by Participants,” Amer
ican Economic Review (Papers and Proceedings) 85 (1995): 250, provides survey data
about managers’ beliefs about the effects of incentive contracts; Margit Osterloh and
Bruno S. Frey, “Motivation, Knowledge Transfer, and Organizational Form,” Orga
nization Science 11 (2000): 538, provides evidence that employees with tacit knowledge
communicate it to coworkers more efficiently without extrinsic motivations, with the
appropriate social motivations, than when money is offered for “teaching” their
knowledge; Bruno S. Frey and Felix Oberholzer-Gee, “The Cost of Price Incentives:
An Empirical Analysis of Motivation Crowding-Out,” American Economic Review 87
(1997): 746; and Howard Kunreuther and Douslar Easterling, “Are Risk-Benefit
Tradeoffs Possible in Siting Hazardous Facilities?” American Economic Review (Papers
and Proceedings) 80 (1990): 252–286, describe empirical studies where communities
became less willing to accept undesirable public facilities (Not in My Back Yard or
NIMBY) when offered compensation, relative to when the arguments made were
policy based on the common weal; Uri Gneezy and Aldo Rustichini, “A Fine Is a
Price,” Journal of Legal Studies 29 (2000): 1, found that introducing a fine for tardy
pickup of kindergarten kids increased, rather than decreased, the tardiness of parents,
and once the sense of social obligation was lost to the sense that it was “merely” a
transaction, the parents continued to be late at pickup, even after the fine was re
moved.
6. James S. Coleman, “Social Capital in the Creation of Human Capital,” American
Journal of Sociology 94, supplement (1988): S95, S108. For important early contribu
tions to this literature, see Mark Granovetter, “The Strength of Weak Ties,” American
Journal of Sociology 78 (1973): 1360; Mark Granovetter, Getting a Job: A Study of
Contacts and Careers (Cambridge, MA: Harvard University Press, 1974); Yoram Ben-
Porath, “The F-Connection: Families, Friends and Firms and the Organization of
Exchange,” Population and Development Review 6 (1980): 1.
7. Nan Lin, Social Capital: A Theory of Social Structure and Action (New York: Cam
bridge University Press, 2001), 150–151.
8. Steve Weber, The Success of Open Source (Cambridge, MA: Harvard University Press,
2004).
9. Maurice Godelier, The Enigma of the Gift, trans. Nora Scott (Chicago: University of
Chicago Press, 1999), 5.		?1
10. Godelier, The Enigma, 106.		0
		?1

480	Notes to Pages 117–153
	11. In the legal literature, Robert Ellickson, Order Without Law: How Neighbors Settle
	Disputes (Cambridge, MA: Harvard University Press, 1991), is the locus classicus for
	showing how social norms can substitute for law. For a bibliography of the social
	norms literature outside of law, see Richard H. McAdams, “The Origin, Develop
	ment, and Regulation of Norms,” Michigan Law Review 96 (1997): 338n1, 339n2. Early
	contributions were: Edna Ullman-Margalit, The Emergence of Norms (Oxford: Clar
	endon Press, 1977); James Coleman, “Norms as Social Capital,” in Economic Impe
	rialism: The Economic Approach Applied Outside the Field of Economics, ed. Peter Bern
	holz and Gerard Radnitsky (New York: Paragon House Publishers, 1987), 133–155;
	Sally E. Merry, “Rethinking Gossip and Scandal,” in Toward a Theory of Social Con
	trol, Fundamentals, ed. Donald Black (New York: Academic Press, 1984).
	12. On policing,	see	Robert C. Ellickson, “Controlling Chronic Misconduct in City
	Spaces: Of Panhandlers, Skid Rows, and Public-Space Zoning,” Yale Law Journal 105
	(1996): 1165, 1194–1202; and Dan M. Kahan, “Between Economics and Sociology: The
	New Path of Deterrence,” Michigan Law Review 95 (1997): 2477.
	13. An early and broad claim in the name of commons in resources for communication
	and transportation, as well as human community building—like roads, canals, or
	social-gathering places—is Carol Rose, “The Comedy of the Commons: Custom,
	Commerce, and Inherently Public Property,” University Chicago Law Review 53 (1986):
	711. Condensing around the work of Elinor Ostrom, a more narrowly defined liter
	ature developed over the course of the 1990s: Elinor Ostrom, Governing the Commons:
	The Evolution of Institutions for Collective Action (New York: Cambridge University
	Press, 1990). Another seminal study was James M. Acheson, The Lobster Gangs of
	Maine (New Hampshire: University Press of New England, 1988). A brief intellectual
	history of the study of common resource pools and common property regimes can
	be found in Charlotte Hess and Elinor Ostrom, “Ideas, Artifacts, Facilities, and Con
	tent: Information as a Common-Pool Resource,” Law & Contemporary Problems 66
	(2003): 111.
	CHAPTER 5. Individual Freedom: Autonomy, Information, and Law
	1. Robert Post, “Meiklejohn’s Mistake: Individual Autonomy and the Reform of Public
	Discourse,” University of Colorado Law Review 64 (1993): 1109, 1130–1132.
	2. This conception of property was first introduced and developed systematically by Rob
	ert Lee Hale in the 1920s and 1930s, and was more recently integrated with contem
	porary postmodern critiques of power by Duncan Kennedy, Sexy Dressing Etc.: Essays
	on the Power and Politics of Cultural Identity (Cambridge, MA: Harvard University
	Press, 1993).
	3. White Paper, “Controlling Your Network, A Must for Cable Operators” (1999), http://
	www.cptech.org/ecom/openaccess/cisco1.html.
	4. Data are all based on FCC Report on High Speed Services, Appendix to Fourth 706
	Report NOI (Washington, DC: Federal Communications Commission, December			?1
	2003).