Technology
“Production is alteration of the given according to the designs of reason. These designs—the recipes, the formulas, the ideologies—-are the primary thing; they transform the original factors—both human and nonhuman—into means. Man produces by dint of his reason; he chooses ends and employs means for their attainment. The popular saying according to which economics deals with the material conditions of human life is entirely mistaken. Human action is a manifestation of the mind. “
–Ludwig von Mises
Before the process of economic production takes place in the real world, it is foreseen in the mind of the individual undertaking it. It is in the human mind that economic possibilities are first imagined, and then carried out in reality. Reason allows us to develop concepts and ideas we use to achieve economic outcomes. Technology can be thought of as the plan of economic action, and the mechanism by which man achieves his ends. Technology is the recipe to the cooking of a meal; not a physical part of the meal, but the cognitive glue that holds it all together. Ideas are a form of capital, in that they increase the productivity of the production process, but they are non-material forms of capital, which makes it not scarce nor rival; a person using a technology or idea does not reduce the ability of others to use it, nor does he reduce its productivity. The implications from the non-physicality of this form of capital are significant.
The process of technological advancement is the continuous development and application of new and better ideas and methods to the process of production, leading to a continuous increase in output per unit of time. Capital accumulation will quickly run into diminishing returns without technological advancement. As the fisherman begins using a fishing rod, his output increases. Without technological advancement, he would continue to invest in more fishing rods, until the point where he has no use for more fishing rods, where the extra investment is just providing him with rods he never needs to use. He would of course stop investing at that point.
But if the fisherman is able to think and come up with new ideas for new methods of deploying capital, if he can imagine new technologies, he can produce new capital goods that are more productive than the fishing rod, and the process of capital accumulation will continue to increase productivity without running into diminishing returns. The fisherman’s reason makes him suspect that fishing will be more productive if he is able to do it from a boat rather than from the shoreline. He invests some of his time and output into building the boat, and then tries it. As discussed in the previous chapter, this investment is expensive and uncertain. It necessitates deferring consumption, it suffers from depreciation, and it entails the risk of failure. But if it does succeed, his productivity will increase. Continuing to invest in more identical boats will now also run into diminishing returns, but human reason will continue to look for new technologies to employ. A better, bigger, faster, safer boat, and new specialized equipment can continue to be invented.
You develop new ways of catching fish. A better fishing rod, a stronger boat. You catch fish you couldn’t catch before.
Technology and Productivity
Matt Ridley
Jeff Booth
Economic growth is not governed by the availability of resources, but by the technological possibilities. If it was based on availability of resources, you would expect that the areas with more resources would be richer than areas poor with resources, but we do not see that to be the case.
Kramer
Kramer’s paper shows that areas with higher population density grow faster than lower population density in the longrun. Because the driver of growth is not rival resources, but non-rival ideas. More people means more non-rival ideas, more productivity.
Ideas are the one thing that cannot be controlled. Nobody can control what you think, no matter what they do. All the world’s armies cannot kill a thought.
Technology and labor
“The substitution of more efficient methods of production for less efficient ones does not render labor abundant, provided there are still material factors available whose utilization can increase human well-being. On the contrary, it increases output and thereby the quantity of consumers’ goods. “Labor-saving” devices increase supply. They do not bring about “technological unemployment.””
The rise of industrialization and the utilization of large amounts of energy in economic production has been accompanied by a incessant complaints about technology replacing labor. On an intuitive and superficial level, this appears to make sense. The more that machines increase their output and productivity, the less workers are needed to produce the same level of output. As individual factories procure machines, they lay off unnecessary workers. Perhaps the most famous and original example of this rage against the machine came from the Luddites, who had organized campaigns to break automated loons, which they argued would destroy the livelihood of the British textile worker. Mechanized farming was said to put farmers out of work. The steam engine was going to make redundant large chunks of the labor force. Telephone operators were needed to connect phone calls when telephones were first invented and deployed, but as automated switchboards were invented, the demand for operators collapsed. More recently, many fast food restaurants are deploying increasingly sophisticated automated tellers that reduce their need for workers. This line of thinking is also central to the Marxist creed, as Marx had argued the gains of mechanization would accrue to the capitalists at the expense of the workers, whose pay would not rise, and whose ranks would dwindle as the rapacious capitalists leave them to unemployment.
Were the luddites right? Would continued automation result in the unemployment of large chunks of the population, leading to horrible societal consequences? The commonalities with Marxist drivel is an obvious red flag to the contrary, and empirical observation does not support the luddites’ contentions, but the definitive answer can only be attained by utilizing the economic way of thinking.
After more than two centuries of automation and industrialization, we somehow find that the vast majority of British adults who want employment find it. While it is true that very few, if any, Brits are doing the menial jobs their ancestors performed in the eighteenth century, they have jobs nonetheless. Even as the population of Britain continued to increase, more jobs continued to apperar, and Brits today earn more, work less, and work in much better conditions than their ancestors in the eighteenth century. Had the Luddites and Marxists been right, one would imagine that two centuries of technological progress would have left absolutely nobody with a job today, let alone better jobs for everyone.
[Chart of British unemployment]
The root of the confusion for Luddites arises because they treat labor as if it is a consumer good, acquired for the utility it provides, rather than a producer good, acquired for the production of consumer goods. A consumer good for which a superior alternative is found is no longer demanded, and can lose its economic value, which is what happened to typewriters after the invention of computers. But demand for a producer good is not contingent on its utility to the purchaser; it is dependent on the good’s usability for production. Even if a factor of production were to be replaced in one production process, it will still be valuable if it can be utilized in another production process.
Labor, in particular, is the least specific of resources, and it can be redirected to other jobs or industries. And labor, being made up of human time, is also the ultimate resource, whose scarcity underpins the scarcity of all other resources, as was discussed in Chapter XX. Everything is made with the input of human labor, and we live in a world of scarcity where there is always a large demand, at the margin, for more goods and services. As technological advancement increases the productivity of labor and therefore makes labor more valuable, it allows for the production of more economic goods, alleviating scarcity, but it does not, and cannot eliminate scarcity, which is, after all, the scarcity of human time itself. As long as humans have unmet needs, there will be avenues for directing human labor to meeting these needs. No matter how much human productivity increases, human desires can increase further, and human reason can continue to devise better solutions for the problems of scarcity. It can always invent better products, better technologies, safer production methods, and generate new demand.
As long as humans have unmet needs, there will be avenues to directing labor toward meeting these needs. We will never run out of jobs, because we could always use more humans making more scarce products to meet other humans’ ever-increasing wants. Scarcity can never be eliminated, because it is the scarcity of time. Work can never end, and man can only choose which tasks to prioritize. The more tasks he can delegate to machines, the more time he has to perform many of the infinite number of tasks he would like to carry out but cannot because of the scarcity of his time.
My favorite example for illustrating how technology increases productivity of labor and does not displace it is to look at the history of technological innovations in the transportation and shipping industries. There was a time in which moving humans or luggage around could only be accomplished by hiring other humans to move them around. A strong healthy man would be able to carry one man, or several dozen kilograms of weights and move them a few kilometers in a day. The job of carrying heavy things without the support of capital had very low productivity, and was so unpleasant to perform, it seems to have been usually the purview of slaves. Only those who could own slaves could afford this kind of labor with any sort of regularity. For the vast majority of others, they could only move, and move things, as far as their own feet take them.
As humans developed the wheel, the possibilities for moving weighty matter around were expanded. By pulling a carriage with wheels, the worker could now move heavier weights for longer distances; in other words, their productivity increased. Combining a horse with the carriage would increase the productivity of the worker even further. With the dawn of the industrial revolution, and the invention of the train, car, truck, shipping container, and airplane, the productivity of modern transportation has increased far beyond pre-industrialization levels. One truck driver can now move up to 50,000kg of weight at a speed of 100 km/h. A handful of crew members can fly an Airbus A380 weighing 575 tons, 300 of which are cargo, at a speed of 900km/h. With a crew of 20-40, the world’s largest container ship, the HMM Algeciras, can move 24,000 shipping containers, each weighing up to 26,000kg, for a total weight of shipping around 600,000 tons, at a speed of 15.2 knots, or 28 km/h.
From the domestication of the horse, to the building of the HMM Algeciras, passing through the wheel, carriage, horseless carriages, trucks, trains, and airplanes, somehow jobs in the transportation industry have yet to be eliminated. Not only that, but there is certainly a larger percentage of full time jobs in the transportation sector today than had existed before the invention of the wheel. In primitive societies that predate the wheel, it is hard to imagine a level of specialization that allows for careers dedicated in moving things around. With low levels of capital, low utilization of non-human energy sources, and primitive technological development, labor’s output was close to the basic level needed for survival. In such a world, the majority of people need to work in producing their own food, and very few people can specialize in other jobs. Given the very low productivity of pre-wheel transportation technologies, it is unlikely many people had enough surplus economic production to hire someone to work in transportation full time, as that person’s opportunity cost would be a significant part of the food they would produce for themselves otherwise. Only someone who was enslaved and had no free will would be forced into this kind of job.
As technology advanced and productivity increased, each person’s production would rise above their daily survival needs, the scope for specialization emerges, as more workers are able to be fed by the effort of others, freeing them up from having to engage in subsistence labor. As productivity increased in the transportation industry, it became feasible for free people to willingly want to work in transportation. As technology and productivity continued to improve, jobs in transportation continued to improve in pay and conditions.
Many people continue to find more work in transportation as the productivity of transport increases. Instead of one worker carrying one man, we now have one worker driving a ship carrying thousands, or an airplane carrying hundreds. The productivity increases, and the amount of work done increases. More people travel and more work gets done, more houses built, more needs met. The more capital is employed in transportation, the more productive a worker in transportation is, and the more they are paid.
Capital set the slaves free. When there was little or no capital, transportation was a job that was only acceptable for slaves. When there were carriages, you had free men willingly take on a job in transportation, because the productivity was high enough to compensate them sufficiently for their time, and allow them to buy sufficient sustenance from others specialized in the production of food. With the introduction of the car, the job of a taxi and truck driver became even better rewarding, and attracts millions of people all over the world. The more technology advances, the more capital is invested in the job, the more productive it becomes, and the more rewarding work in it is. Today, many highly skilled engineers, technicians, and various other professionals work in the shipping and transportation industry. The productivity is so high that capitalists make millions in profit every year from operating this capital.
Reisman:
Slavery was particularly damaging to the South, because it created in the market value of slaves a fictional capital that made the accumulation of real capital in such forms as factory buildings and machinery seem unnecessary. The South’s economic backwardness was a result.
To Luddites and Marxists, the invention of the wheel would have appeared an unmitigated disaster–just think of all the lost jobs in the carrying-painfully-heavy-stuff industry! But in reality, it was a great boon for humanity, as it freed humans from carrying heavy loads and instead allowed them to focus on more productive jobs.
The value of goods, as discussed in Chapter 1, comes from their suitability to fulfilling human needs. The human need for movement and transportation cannot be eliminated by being met more efficiently. Humans are mobile, and they don’t like to stay in the same place. Diminishing returns set in on being in the same place, and individuals seek to move. Trade requires the movement of goods, and the larger the scope for trade, the more productivity gains can be had. These economic realities make transportation a need that has existed in all times and places, and one has no reason to expect this need to be eliminated any time soon. Individual jobs in transportation at any point in time represent the most productive and technologically advanced solution to the problem of transportation available at that time. When a new technology is invented, it does not eliminate the need for transportation, it allows labor to be directed to a more productive solution for transportation.
Therefore, it is no coincidence that humanity’s economic conditions continue to improve with technological advancement. This is not going to change any time soon. The more productive our technology, the better off we are. If humanity were to listen to the Luddites and fight technological advancement, none of us would have any time to do any of the immensely productive things we do in today’s modern society. We would be too busy engaged in very primitive tasks like carrying heavy loads for us to do anything else.
The bad news for Luddites is that their opponent is far more powerful than even they imagine. They are not up against greedy capitalists looking to cheat workers; they are up against the full force of economic reality and humans’ actions responding to economic incentives. The value that accrues to humanity from new inventions that enhance our productivity is far too significant and tempting for legislation and machine-breakers to overcome. They may have destroyed a few factories and impoverished a few capitalists and many more workers, but the Luddites were helpless in preventing the forward march of economic and technological progress.
While the Luddites of the early 19th century did succeed in destroying many machines and some factories, these victories against human advance were few and far between. Their movement died and their ideas became the butt of jokes, while technological advancement continued to make life better for everyone. While Luddites may influence some people with their deceptively appealing ideas, they are utterly powerless to stop the ingenuity of billions of human beings from making life better for all of us. Once a wheel, loom, car, airplane or software code is invented, people will recognize the value it provides in terms of increased productivity. Violent restrictions may succeed in delaying these technologies, but they also serve to increase the returns to their use to those who manage to get around them. The individuals, businesses, or regions that utilize a productive technology that is not utilized elsewhere can produce at lower prices.
Drivers of technological innovation
Mises: “What is wrong with our age is precisely the widespread ignorance of the role which these policies of economic freedom played in the technological evolution of the last two hundred years. People fell prey to the fallacy that the improvement of the methods of production was contemporaneous with the policy of laissez faire only by accident.”
Traditionally, universities teach the linear model of technological advance.
But economists have better ways of explaining and understanding it.
Kealey
- Smith model
Vicenti
Scranton
How innovation is inextricably tied to entrepreneurship.
Ridley
Software
As human knowledge advanced, our ideas have resulted in the creation of ever-more complex machines to produce the ends we value. As more and more of the operation of the machine became tedious and predictable, humans began to devise ways for automating the instructions the machine needs. Cloth-making looms were soon equipped with guiding patterns and punch cards that would produce reliable patterns in the fabric without requiring conscious and continuous human supervision. Some mechanical machines were being utilized to perform mathematical calculations at a faster and more reliable rate than that of human calculators. The age of machines being controlled by information had begun.
In 1822, English polymath and inventor Charles Babbage worked on developing a ‘difference engine’, which was used to compute polynomial functions. He was unable to complete the construction of the engine, although his design would survive, and the London Science Museum would later construct an operational machine based on it in 1991. In 1833, Babbage started work on a more general design, the Aanlytical Engine, which would incorporate many of the essential features of modern day computing, a century before they achieved commercial success.
Perhaps the most fascinating aspect of Babbage’s design was that it was programmable using punch cards. Ada Lovelace, the only legitimate daughter of Lord Byron, developed in 1842 an algorithm to calculate a sequence of Bernoulli numbers on Babbage’s machine, giving her a strong claim for the title of the world’s first programmer. While Babbage and Lovelace were not successful in developing commercial computers, they were instrumental in advancing the science and art of computer development until it would bear fruit in the twentieth century. The Babbage Analytical Engine was too difficult and expensive to successfully construct and operate commercially given the industrial and technological reality of the nineteenth century, but by the twentieth century, it became possible.
Electricity would enter into the operation of these machines and increase their productivity and complexity. Highly sophisticated wiring boards and circuits would be needed to control them. As the sophisticated new breed of electric machines could compute difficult mathematical problems, they were termed computers. In 1941, German engineer constructed what is widely regarded as the first programmable computer, the Z3.
The instructions that operated the early computer machines were coded into them through electric circuits or punch cards. Getting an early computer machine to perform a slightly different function usually required adjustments to its hardware and processes, as well as sophisticated re-wiring. By the late 1940s, it became possible to store these instructions into computers electronically, with the ENIAC . In the 1950s and 1960s, computer programming languages were developed that would allow for programs to be specified in a more abstract way, independent of the architecture of the computer. The development of these standardized programming language, and the growing number of people worldwide who could read and understand and write them, brought about an entirely new type of economic good with enormously transformative implications.
This economic development has had an outstanding impact on the world in the past seven decades. Ideas, recipes, and technologies can now be coded, through abstract letters and numbers only, into hardware to control its operation and allow it to perform ever-more complex tasks. For most of the population of 19th century Britain, the punchcards inserted into obscure and highly complex machines must have seemed unintelligibly insignificant. Today, software, as instructions codified into standard languages for machines to perform functions, is eating the world, to borrow a popular phrase.
Software can be thought of as the purest form of technological good. It consists entirely of data, and has no physical form. It can be communicated around the world very quickly with modern communication tools, and it is non-rival and non-scarce. Applying software to an industrial process allows for the increased automation of the functions of the machines, requiring less human supervision and labor. Software allows for far better organization of resources and supply chains to reduce costs and increase efficiency.
Artificial intelligence
Intelligence is the ability of an entity to act successfully in its own interest, according to its own will. There is no external objective definition of what constitutes an individual’s intelligence; it can only be defined by the individual himself. The fundamental tenet on which economics is built is that value is subjective: there can be no objective definition of what constitutes value independent of the individual assessing it. What appears valuable for one person may be worthless to another, and there can be no correct way of determining whose valuation is correct, nor should there be: each individual’s valuation is correct for them.
Since values and ends are subjective, it is not possible to posit an objective measure of intelligence based on accomplishing specific tasks. Intelligence can help a person become prosperous, but an intelligent person could choose to pursue ends other than wealth. Intelligence is necessary to be competent at a specific technical field like math or physics, but that cannot mean that anyone who is not competent at that field is not intelligent, since many intelligent people will have no interest in it. There is no possible way of positing an objective definition of intelligence because an intelligent being acts according to its own will, and not the will of the person seeking to assess its intelligence.
The quintessential fact about an intelligent being is not some technical requirement or test to pass, but that it act according to its own interest and its own will. An intelligent man is a man who succeeds in achieving the ends he sets out for himself; while an unintelligent man fails at achieving his own ends. Only a living organism has a will, and only a living organism can act according to it. Anything artificially created by man will not have its own will; it will rather be a tool to further the will of its creators. A hammer is but a tool for the carpenter, wielded at his will to achieve his ends, no matter what tasks the hammer performs, it will always be the tool of the living acting intelligent man to exercise his will.
All machines, no matter how complex and successful at performing a specific task will always be no different from the hammer in their essence: They are dead substances put together by human beings to meet human beings’ needs. To posit any specific technical feat of machines as a marker of intelligence is no different from calling a hammer intelligent for hammering nails when used by a carpenter. The builders and users of the hammer are the ones who are intelligent, the hammer is but a dead tool. It is absurd to proclaim “advances in Artificial Intelligence” whenever a new objectively-set milestone for computers is reached. Whether it is milestones in processing power, success at a game, or being programmed to hold a conversation, all of these feats are wonderful testament to the brilliant intelligence of the builders of these machines, which are, after all, still dead dumb matter incapable of ever acting in its own interest.
This has been the modus operandi of the devotees of Artificial Intelligence, who construct ever more complex and meaningless objective definitions for intelligence, only for them to go into fits of excitement when the machine achieves them. The most recent milestone consists of computers beating the world champion at ‘Go’, a game of which the vast majority of the human race has never heard, or has no interest in playing. Machines have been ‘winning’ at countless games against humans for decades, but this is only a testament to the intelligence of the machine programmer that distilled the rules of these games to a machine. Another popular definition of intelligence is the ability of a machine to conduct a conversation with a human being without the human being detecting that they are talking to a machine. While this may or may not be a useful test of intelligence of the human having the conversation, and the human programming the computer, it has no bearing whatsoever on the nonexistent intelligence of the machine programmed to perform this conversation, because, like a hammer, it is just matter being used to the end of its human designer.
Only living organisms are endowed with a will. For animals, this will is controlled by their basic instinct for survival and reproduction, while for humans, our highly developed thinking ability can allow us to develop complex and more refined goals and ends over longer time horizons. Dead matter cannot have a will, and cannot be given a will by a human, because it would then just be acting in the will of the human, not its own. In order to create ‘Artificial Intelligence’, humans need to first create Artificial Life: a living organism constructed out of dead matter, and not out of other living organisms.
This is not a new quest, and ambitious humans have been attempting it for generations, with complete and resounding failure. The only way to create a living organism is out of other living organisms. In the same way that humans can only be created from other humans, there is no way to create an apple tree except from an apple seed. Even the tiniest living microbes cannot be prepared from anything but other living microbes. The essence of life that flows through matter to make it living is something that exists in nature all around us, but which we cannot manufacture or prepare. Until such a time when artificial life can be created, no artificial object could ever have a will of its own, and no artificial object can be called intelligent without butchering the true meaning of the word.
Property in ideas
Technology is a form of capital. It also serves to increase productivity of labor. It is distinct from physical capital in that it is non-rival. One person using a technology does not reduce its usefulness to others. One person invented the wheel, billions have used it.
Everything created by humans starts as an idea.
It has the enormous advantage of not being physical. It is much harder to stop and control by governments. Improvements in technology are more likely to improve economic outcomes today because capital accumulation is easier to control and restrict by governments.
Not that they are not trying. Patent laws, intellectual property, World Trade Organization are all actively preventing the spread of ideas and trying to minimize the number of people that benefit from them. But the internet is stronger than all of them!
Mises: “We have inherited from our forefathers not only a stock of products of various orders of goods which is the source of our material wealth; we have no less inherited ideas and thoughts, theories and technologies to which our thinking owes its productivity.”
See: Kinsella, Against Intellectual Property: https://nakamotoinstitute.org/literature/against-ip/
“Copyrights pertain to “original works,” such as books, articles, movies, and computer programs. They are grants by the state that permit the copyright holder to prevent others from using their own property—e.g., ink and paper—in certain ways. Thus copyright literally results in censorship”
“Patents grant rights in “inventions”—useful machines or processes. They are grants by the state that permit the patentee to use the state’s court system to prohibit others from using their own property in certain ways”
“Both patent and copyright are simply state grants of monopoly privilege. In both cases, the state is assigning to A a right to control B’s property: A can force B not to engage in certain actions with B’s resources. Since ownership is the right to control, IP grants to A a co-ownership right (a negative servitude) in B’s property.”
There’s no way of enforcing intellectual property rights that reduces conflict. It must involve individuals exerting ownership and control over the bodies of others.
I own the rights to this book, but I have no problem with people pirating it. I will post it for free download on my website. The more people who read it for free, the more people buy the book.
Abolishing intellectual property does not prevent you from keeping trade secrets, it just places the cost of maintaining the secret on the concerned person, it does not distribute it to society. There is nothing about ideas that makes them an exception to the non-aggression principle. Even if there were an increased benefit to some segment of society, that does not justify the initiation of aggression against peaceful people. And yet the empirical arguments for increased benefits to society from intellectual property laws are very weak.
Utilitarian arguments
Boldrin and Levine examine these and find little empirical support for the idea that intellectual property leads to more innovation or growth.
“there is no empirical evidence that they serve to increase innovation and productivity, unless productivity is identified with the number of patents awarded—which, as evidence shows, has no correlation with measured productivity. This disconnect is at the root of what is called the “patent puzzle”: in spite of the enormous increase in the number of patents and in the strength of their legal protection, the US economy has seen neither a dramatic acceleration in the rate of technological progress nor a major increase in the levels of research and development expenditure.”
“In 1983 in the United States, 59,715 patents were issued; by 2003, 189,597 patents were issued; and in 2010, 244,341 new patents were approved. In less than 30 years, the flow of patents more than quadrupled. By contrast, neither innovation nor research and development expenditure nor factor productivity have exhibited any particular upward trend. According to the Bureau of Labor Statistics, annual growth in total factor productivity in the decade 1970 –1979 was about 1.2 percent, while in the decades 1990 –1999 and 2000 –2009 it has been a bit below 1 percent.”
Other problems with patents:
1- rent seeking
2- slowing innovation because it is a tax on new innovators
3- endless litigation
4- patent trolling
5- First mover advantage is strong enough
McElroy. Contra Copyright, Again:
Ultimately copyright involves making a claim of ownership over another person’s mind and body. You need to have a claim of ownership over my body to prevent me from speaking my ideas.
“Copyright—the legal claim of ownership over a particular arrangement of symbols—is a complicated issue because the property being claimed is intangible. It has no mass, no shape, no color. For the property claimed is not the specific instance of an idea, not a specific book or pamphlet, but the idea
itself and all present or possible instances of its expression.”
“I advocate a form of copyright—free market copyright. I view copyright as a useful social convention to be maintained and enforced through contract and other market (voluntary) mechanisms. This is in
contradistinction to those who believe copyright can be derived from natural rights; in other words, ideas or patterns are property and their exclusive ownership does not require a contract anymore than preventing a man from stealing your wallet requires a prior contract. “
“My ideas are like stacks of money locked inside a vault which you cannot acquire without breaking in and stealing. But, if I throw the vault open and scatter my money on the wind, the people who pick it up off the street are no more thieves than the people who pick up and use the words I throw into the public realm.”
“If copyright were not the norm, if all of us had not grown up with it, we might consider it as absurd as a house owner claiming special, legal protection of the pattern of colors with which he had painted his home or the arrangement of rocks in his garden.”
Most of the world’s great authors—Shakespeare for example—wrote without copyright.
Thanks to the internet, technological advancement, and continuously increasing levels of productivity, the majority of humanity needs to work no more than a few days to afford a device that can connect to the internet and access the majority of the world’s information.
Ideas are the only non-scarce productive assets. As technology and telecommunication becomes cheaper, it just becomes easier and cheaper to copy productive ideas. The cheaper it is to spread and copy good ideas, they more productive the world becomes. Intellectual property laws impose a higher cost on the transfer of ideas. In today’s world, this primarily benefits the people who work in the field of intellectual property, but not the creators or the producers, and not the copiers or society at large. “If I have seen further, it is by standing on the shoulders of giants” was how Isaac Newton paid tribute to the many people from whom he learned. Intellectual property laws are a tax on climbing on the shoulders of giants. In his time, obtaining the knowledge of others required paying large sums of money to obtain expensive manuscripts. In our time, the vast majority of human knowledge is available online for free. Hundreds of years of progress have given the vast majority of humans on earth access to a very large number of shoulders.