Two Great Papers

by on May 16, 2006

I spent part of my weekend attacking the big stack of reading material I’ve been accumulating recently, and I wanted to (rather belatedly) plug two excellent papers.

The first is Yochai Benkler’s “Coase’s Penguin”, which is a few years old now but every bit as relevant today as it was when it came out in 2002. It offers a framework for analyzing peer-production processes (such as the development of open source software) that puts it on par with the firm and the market as methods for organizing cooperative ventures.

His central insight is that many types of information-processing tasks are characterized by enormous variations in motivation, knowledge, and talents of potential producers, and that this information often cannot be efficiently standardized in a manner necessary to transmission via prices (for markets) or hierarchical decision-making (in firms). Because firms and markets segregate people and resources into many private fiefdoms, it’s unlikely that the person best suited to perform a particular task will be found in the firm that needs the task to be performed. And if the tasks are granular enough (say, fixing a bug in the Linux kernel) the search and transaction costs of finding the right person and negotiating a contract with him or her might be too large to justify it. In contrast, because peer production allows people to self-select into the projects that interest them most, people can often be allocated to projects at very low cost.

I found this argument particularly compelling because it fits with my experiences trying to find people to do work for the Show-Me Institute. It’s very difficult to judge from a resume whether a particular individual would make a good intern, research assistant, write a good paper, etc. One of the best ways of improving your chances of getting a job in a think tank or a public policy magazine like Reason is to start a blog. In the first place, a blog allows a potential employer to peruse real-world examples of your work and judge whether you’re a good writer without having to ask you to do writing samples specifically for him or her. In the second place, the blogosphere has some built-in mechanisms to aid potential employers to sift through the potential candidates. Particularly talented bloggers can catch the attention of other bloggers, who add them to their blogrolls. Finally, (and this is the part where Benkler’s argument is particularly relevant) starting a blog might help you to find opportunities you wouldn’t otherwise have even known about. If you write a blog about foreign policy, for example, there might be people out there looking for foreign policy writers who you wouldn’t have been able to find via other means.

So I highly recommend Benkler’s paper if you haven’t read it yet.

The other paper, ironically enough, is largely a critique of one of Benkler’s other pet issues, instituting a spectrum commons. It’s by my friend and co-blogger Jerry Brito. It’s titled The Spectrum Commons in Theory and Practice.

This isn’t an issue I’d really looked at in any detail before I read Jerry’s paper. I’d read various people claim that you could manage spectrum as a commons, and I was always suspicious of the argument. Jerry’s paper confirmed my suspicions. He argues that in a world of scarcity, a commons pre-supposes a manager whose job it is to set ground rules that can prevent over-grazing of the commons. A spectrum commons can theoretically be managed either by a private company or by the government, but in practice, spectrum commons end up being managed by the government. And as Jerry shows in an extended example on the history of the FCC’s decision making concerning the 3650 MHz frequency band, the FCC’s first experiment in creating a spectrum commons was far from ideal. First, the proceedings generated a lot of rent-seeking by those lobbying for competing uses of the spectrum. And second, it’s not clear that the rules the FCC ultimately imposed will lead to efficient utilization of the spectrum.

Jerry concludes that a spectrum commons is not a “third way” between command-and-control and markets. A commons requires a regulator, and the issue is still who regulates, the government or a private actor? Jerry makes a persuasive argument that creating property rights in spectrum and allowing private actors to deploy it for their highest-valued use is likely to lead to the most efficient utilization.

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