We tend to think of intellectual property law as targeted mostly at big ideas with big market value. But for every big idea there are zillions of little ideas whose value adds up to more. Little ideas are little because they are either self-contained and make marginal contributions or they are small steppingstones, to be combined with other little ideas, which eventually are worth a lot.
It’s now cheap to spread little ideas. Whereas before even very small communication costs made most of them prohibitively expensive to share. In some cases this is good, but in some cases it can be bad.
When it comes to the nuts and bolts kinds of ideas, like say how to use perl to collect data on the most popular twitter clients, ease of dissemination is good and intellectual property is bad. IP protection would mean that the suppliers of these ideas would withold lots of them in order to profit from the remainder. Without IP protection there is no economic incentive to keep them to yourself and the infinitessimal cost of sharing them is swamped by even the tiniest pride/warm glow motives.
Now the usual argument in favor of IP protection is that it provides an economic incentive for generating these ideas. But we are talking about ideas that don’t come from research in the active sense of that word. They are the byproduct of doing work. When its cheap to share these ideas, IP protection gets in the way.
The exact same argument applies to many medium-sized ideas as well. And music.
But there are ideas that are pure ideas. They have no value whatsoever except as ideas. For example, a story. Or basic research. The value of a pure idea is that it can change minds. Ideas are most effective at changing minds when they arrive with a splash and generate coordinated attention. If some semblance of the idea existed in print already, then even a very good elaboration will not make a splash. “That’s been said/done before.”
Its too easy now to spread 1/nth-baked little ideas. Before, when communication costs were high it took investment in polishing and marketing to bring the idea to light. So ideas arrived slowly enough for coordinated attention, and big enough to attract it. Now, there will soon be no new ideas.
Blogs will interfere with basic research, especially in the social sciences.
When it comes to ideas, here’s one way to think about IP and incentives to innovate. It’s true that any single individual needs extra incentive to spend his time actively trying to figure something out. That’s hard and it takes time. But, given the number of people in the world, 99.999% of the ideas that would be generated by active research would almost certainly just passively occur to at least one individual.
Cheap Talk 
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February 25, 2010 at 4:17 pm
John
Early in my career I came up with the idea of incorporating deuterium as a replacement for hydrogen in drugs. The concept was that because carbon-deuterium bonds are harder to break than carbon-hydrogen bonds, the drugs would stay in the body longer and require less frequent dosing. This was a fairly simple idea based on first principles that did not require any real research.
I spoke to a few people about my idea, and they pretty much told me it would never work because deuterium was too expensive. I did not pursue it. Twenty years later there are hundreds of patents in this area, and several deuterated drugs undergoing clinical testing.
The point of my story is that several people had the same idea, but some had the conviction to actually act on it. Those folks fleshed the idea out a little bit, filed patents, and and began pouring money into developing products. This is the step in the innovation process that requires intellectual property protection, perhaps more than the step of creating the idea.
Development is oftentimes many fold more expensive than discovery.
February 25, 2010 at 4:38 pm
John
“Before, when communication costs were high it took investment in polishing and marketing to bring the idea to light. So ideas arrived slowly enough for coordinated attention, and big enough to attract it. Now, there will soon be no new ideas.”
I would argue that this paragraph does not fit well with historical experience. Ideas beget ideas, and the more rapidly information is exchanged, the faster new ideas are created. Look at the Renaissance, and its contrast to the lack of technological progress that occurred under feudalism. In the modern era, neural networks could not be developed until there were computers, computers could not be developed until their were solid state circuit boards, and solid state electronics could not be developed until there were semiconductors.
In spite of “cloud creativity”, I think there will always be a handful of individuals who through unusual talent, or through the good fortune of having been exposed to two different pieces of information that most people were exposed to only one of, will have new ideas before they occur to anyone else. These ideas will meet the USPTO’s standard of “non obvious to one of ordinary skill in the art”.