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Papers Somewhere in the Queue

Like a lot of scholars, I have many more ideas for papers than I have time to write them. Here’s one of those: Apply the lessons of agglomeration economics to IP markets.

The thought is inspired in part by this post at Concurring Opinions by David Schleicher, pointing to this recent paper by David Schleicher and Dan Rodriguez. I have written a little about agglomeration economics in the context of regional economic development.

The underlying insight of agglomeration economics is that clustering people and firms leads to positive spillovers.  The field is best known as an account of urban development — of cities, among other things, but it is conceptually related to some standard law-and-economics tools whose application to IP is well-known: network effects, for example.

One could, I think, apply agglomeration economics directly to IP.  The toolkit supplied by agglomeration economics, particularly in its early forms (prior to 1980, more or less)  includes some things that standard law-and-economic analysis doesn’t provide, at least not in any rich form: a full inquiry into the sources and effects of individual behavior (contrasted with the assumption that individuals are rational decisionmakers, behaviorally constrained or otherwise), an interest in the dynamics of clustered or agglomerated markets, rather than their static costs and benefits, and specific attention to supply-side considerations (the sources and natures of products and services that serve as inputs into industrial production), in addition to demand for outputs.

What might be learned?   “Gains from agglomeration” appear in some clustered markets or communities (speaking of clusters of people, or firms, or products and/or services), and fail to appear in others. That means that exogenous shocks to those markets (shifts in demand, technological shifts, a change in available resources) may be more or less destabilizing and new equilibria may be more or less difficult to achieve. Market actors in agglomerated economies may be better positioned to adapt — or less so — and therefore may be more or less motivated to demand compensatory changes in the law.   The histories of various IP industries (music, film, publishing, chemicals, pharma) might be examined as examples and illustrations of more and less successful adaptation by differently agglomerated market actors.