Wealth without Markets?

Abstract:     
Yochai Benkler's The Wealth of Networks: How Social Production Transforms Markets and Freedom is an enormously ambitious new book, one that aims for, and deserves, canonical status within the intellectual property literature. Benkler's book contains two particularly powerful claims. First, he argues that society is in the midst of an economic revolution, whereby technology-assisted social production (e.g., Wikipedia, Slashdot, SETI@home, etc.) stands poised to rival market production as a creator of wealth. Second, he posits that the social production revolution will have laudable distributional consequences, substantially benefiting poor people and poor nations. This book review assesses the most significant contributions in Benkler's work and points to some of its shortcomings. In particular, the review argues that market producers will have very promising competitive strategies at their disposal when they see social producers threatening their revenue streams, that the proliferation of socially produced reputation systems might well trump the progressive tendencies that Benkler identifies, and that adopting legal rules designed to promote social production is an unduly roundabout strategy for reducing economic inequality.

Keywords: intellectual property, social production, peer production, Wikipedia, SETI@home, Slashdot, Myspace, Youtube, eBay, inequality, economic development, Internet, reputation

Accepted Paper Series