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Things that make you say hmmmmm….

I read a few articles lately and they seem to point to an interesting economic relationship. In today’s (August 28th) New York Times, Hal Varian (of Berkeley) discusses the role of used books in the marketplace. Authors’ and rightsholders’ groups have long complained that Amazon’s selling of used and new books through the same service hurts their sales. Varian argues that this might actual help the market for new books. What struck me was his metaphor – you purchase a new car, and pay a good premium to buy it new, based on the sure knowledge that there is a resale market for it. I’d never throught of it that way.
Then, almost the same day, I forget exactly where, I read that teens who download free music are very much more likely to actually buy music (through iTunes or on CD, etc.) Hmmmm.
Combined these facts with the common knowledge that library users are much more likely to buy books too – even though they borrow a lot as well. I find this very interesting.
I have long suspected that there must be a different relationship economically between commodities and information/ideas.
Soooo, it makes me think that we need to look at the overall information and reading market more broadly than just the role of libraries, search engines, databases or bookstores. We’re part of a greater global knowledge ecology and this has a very different economic model that is expanding exponentially due to the boundarylessness of new technolgies. The supply and demand model applies to limited resources like grain, oil or pork bellies. In a world where there is an infinite supply of information and ideas things are different.
Think of it this way: If I have an apple and you have an orange. We each have one piece of fruit. I give you my apple and you give me your orange, we each still have one piece of fruit. Now, in another scenario, I have an idea and you also have a good idea. I share my idea with you and you share your dea with me. We each now have TWO good ideas. See the difference?
Now put this on a global scale, speed it up with better idea and information storage and distribution, and you see the power of the idea storehouses of our culture. Libraries. Hmmmmm.
Things that make you say Hmmmm

Posted on: July 28, 2005, 11:47 am Category: Uncategorized

5 Responses

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  1. Stephen — I think you make a good point. I’ve noticed that a number of websites have seemed to create self-contained information “sub-markets” online. A good example is newgrounds ( Here you have flash makers and flash watchers rewarding each other without the exchange of cash. Flash makers gain status via watcher comments & scores. Flash watchers gain status because when they vote, they attain “levels” which increase the value and influence of their vote. It’s like Tom Fulp has invented his own “invisible hand” using IT. Pretty smart for a guy who started this when he was a teenager.
    Ryan. . .

  2. Hmm indeed! Was this the article on music you saw?
    Interesting stuff…

  3. It would be curious then, if an idea, the fugitive fermentation of an individual brain, could, of natural right, be claimed in exclusive and stable property. If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me.
    — Thomas Jefferson in a letter to Isaac McPherson, 13 August 1813.

  4. Stephen,
    If I have an apple and share it with one hundred people, they each get a tiny sliver of apple.
    If I have an idea and share it with one hundred people (as in reading out-loud), they each have the complete idea.
    I think that Loaves and Fishes is about passing out knowledge and wisdom to feed people’s minds rather than food to feed their bellies.
    Not only that but maybe my idea triggers new ideas in some of the multitude and so we have ideas which never existed before.
    It’s one of those things that the more you share the more you have.

  5. suppose you and I both have an idea, and we exchange our ideas.
    as well as each of us having two ideas, it’s likely we’ll combine these ideas to produce a new idea
    (unlike apples and oranges, ideas are eager to cross-pollinate)