Digital Goods and the New Economy

Digital goods are bitstrings, sequences of 0s and 1s, which have economic value. They are distinguished from other goods by five characteristics: digital goods are nonrival, infinitely expansible, discrete, aspatial, and recombinant. The New Economy is one where the economics of digital goods importantly influence aggregate economic performance. This Article considers such influences not by hypothesizing ad hoc inefficiencies that the New Economy can purport to resolve, but instead by beginning from an Arrow-Debreu perspective and asking how digital goods affect outcomes. This approach sheds light on why property rights on digital goods differ from property rights in general, guaranteeing neither appropriate incentives nor social efficiency; provides further insight into why Open Source Software is a successful model of innovation and development in digital goods industries; and helps explain how geographical clustering matters.aspatial, emergence, idea, information, innovation, intellectual asset, Internet, knowledge, Open Source, weightless economy

FinBook: literary content as digital commodity

This short essay explains the significance of the FinBook intervention, and invites the reader to participate. We have associated each chapter within this book with a financial robot (FinBot), and created a market whereby book content will be traded with financial securities. As human labour increasingly consists of unstable and uncertain work practices and as algorithms replace people on the virtual trading floors of the worlds markets, we see members of society taking advantage of FinBots to invest and make extra funds. Bots of all kinds are making financial decisions for us, searching online on our behalf to help us invest, to consume products and services. Our contribution to this compilation is to turn the collection of chapters in this book into a dynamic investment portfolio, and thereby play out what might happen to the process of buying and consuming literature in the not-so-distant future. By attaching identities (through QR codes) to each chapter, we create a market in which the chapter can ‘perform’. Our FinBots will trade based on features extracted from the authors’ words in this book: the political, ethical and cultural values embedded in the work, and the extent to which the FinBots share authors’ concerns; and the performance of chapters amongst those human and non-human actors that make up the market, and readership. In short, the FinBook model turns our work and the work of our co-authors into an investment portfolio, mediated by the market and the attention of readers. By creating a digital economy specifically around the content of online texts, our chapter and the FinBook platform aims to challenge the reader to consider how their personal values align them with individual articles, and how these become contested as they perform different value judgements about the financial performance of each chapter and the book as a whole. At the same time, by introducing ‘autonomous’ trading bots, we also explore the different ‘network’ affordances that differ between paper based books that’s scarcity is developed through analogue form, and digital forms of books whose uniqueness is reached through encryption. We thereby speak to wider questions about the conditions of an aggressive market in which algorithms subject cultural and intellectual items – books – to economic parameters, and the increasing ubiquity of data bots as actors in our social, political, economic and cultural lives. We understand that our marketization of literature may be an uncomfortable juxtaposition against the conventionally-imagined way a book is created, enjoyed and shared: it is intended to be

The Impact of ICT in Making Global Markets More Inclusive

Analysis based on models of (i) matching, (ii) network externalities, (iii) trade fragmentation, and (iv) resource supply on technological progress, shows that longer-term trends set in motion, from new technology enabled global sourcing, improve equity. Firms in emerging markets gain more access; labour markets become more inclusive. Global sourcing has the potential to raise the mobility and market access of virtual labour to match that of capital, despite continuing restrictions on migration. It makes a wider menu of jobs available to labour categories that were earlier excluded because of their higher transaction costs of reaching markets. It improves labours exit options and therefore bargaining power. Trade fragmentation or splitting of the production chain across countries reverses earlier tendencies for trade to be confined to countries with similar industry structure. Further induced technological progress reduces wage inequalities within and across nations. Government policy initiatives and firms strategies to boost and utilize these trends are examined.Global sourcing, technology, Remote Work, Equity, Trade fragmentation, Production chains

Beyond Bitcoin: Issues in Regulating Blockchain Transactions

The buzz surrounding Bitcoin has reached a fever pitch. Yet in academic legal discussions, disproportionate emphasis is placed on bitcoins (that is, virtual currency), and little mention is made of blockchain technology—the true innovation behind the Bitcoin protocol. Simply, blockchain technology solves an elusive networking problem by enabling “trustless” transactions: value exchanges over computer networks that can be verified, monitored, and enforced without central institutions (for example, banks). This has broad implications for how we transact over electronic networks. This Note integrates current research from leading computer scientists and cryptographers to elevate the legal community’s understanding of blockchain technology and, ultimately, to inform policymakers and practitioners as they consider different regulatory schemes. An examination of the economic properties of a blockchain-based currency suggests the technology’s true value lies in its potential to facilitate more efficient digital-asset transfers. For example, applications of special interest to the legal community include more efficient document and authorship verification, title transfers, and contract enforcement. Though a regulatory patchwork around virtual currencies has begun to form, its careful analysis reveals much uncertainty with respect to these alternative applications

A REVIEW OF SELECTED LITERATURE IN THE ECONOMICS OF DIVISION OF LABOR FROM 5TH CENTURY TO WWII: PART I

First of all, one point seems in order regarding the title: this article is not intended to be comprehensive in its coverage. Rather, it focuses on a deliberately and highly selected body of studies on the division of labor ranging from ancient Greeks to WWII as represented by those reproduced in Sun (2005a), with particular attention paid to what I believe has been relatively unknown even among economists of specialization. A more systematic examination, covering hundreds of studies on the division of labor by ancient Greeks, ancient Chinese, medieval Islamic scholars, medieval Latin scholasticists and Anglo-Europeans of recent centuries is found in Sun (2005b). But what is the (commonly accepted definition of) division of labor? The one that Peter Groenewegen uses for the entry ???division of labor??? in New Palgrave's Dictionary of Economics (1987, p.901) may be accepted by overwhelmingly most, if not all, economists: ???The division of labor may be defined as the division of a process or employment into parts, each of which is carried out by a separate person.??? That is, individuals cooperate, consciously or not, to undertake a divisible process or employment. As such, there naturally emerge two fundamental questions: Why, and how does the separation of employment among persons bear upon important economic and social consequences? In fact, the studies to be surveyed below that emerged over twenty-five centuries or so up to WWII basically centre round the above questions. We will first of all map out the evolution of ideas about division of labor up to the classical political economy in Sections I and II. For the body of economic analysis was considerably enriched since then, with different schools/perspectives simultaneously developing and sometimes competing with one another, we will focus on three themes, explored respectively by three most influential schools that have made contributions of lasting value to the economics of the division of labor. Section III examines the idea of mutual interdependence between increasing returns to the division of labor and the extent of the market originating from Smith, substantiated by Wakefield, Mill, Marshall and culminating in Young (1928). Section IV focuses on the division of labor in society and the division of labor in manufacture, on which Marx offers important insights, foreshadowing some modern theories of the firm well into 1990s. Analyses of unfavorable sociological consequences of the division of labor are also briefly surveyed in this section. Section V examines literature on the overarching theme of the spontaneous order, which can be traced back to Mandeville and was later on elaborated by the Scottish Enlightenment men, and the Austrians especially Hayek. Indeed, the Austrians not only developed a general theory of the spontaneous order but also applied it to analyses of many issues that are concomitant with the division of labor, in particularly the origin of money and the socio-economics of dispersed knowledge. Finally, Section VI concludes.