The End of a Market Economy?

What happens when you no longer own goods, but rather have rights to access them?

Is this happening?  Music, movies, and books.  At best, in the music world, you own a digital version of a song, encoded in an open format.  At worst, you own the “rights” to play a song in a proprietary interface.   Blu-ray will keep the physical aspect of movies rolling for a while — but with Hulu, Netflix On-Demand, and the like, streaming takes movies to the same place — “rights” rather than ownership.  And finally, as I play more and more with my Kindle, I see the world of books moving this way.

The common denominator in all of these are that they are information goods.  How do you create a market for goods you don’t own?  A key component of a market economy is that the goods are salable.  Now that I’ve purchased a book for my Kindle, how do I sell it when I’m done reading it (or donate, give it, lend it)?

My prediction: “Rights’ Exchanges.”  If software protection can ever get ahead of protection cracking, you’ll see people buying and selling rights to things.  I’m going to have to go back to my Econ books to figure out what the implications of that are.

Imagine instead of buying my public transit smart card, I buy transit rights — ones that I can use, trade, sell, or give away.  I wonder if the city could make more money by discounting bulk rights purchases so they could basically sell to capacity — rather than sell to demand.  Would this work?  It’s kind of like being a season ticket holder.  The original seller ensures a floor of revenue, minimizing risk, while the resellers take on more risk if they choose to time demand spikes.

Going to have to think more about this one.

Tags: , , , ,

Comments are closed.