On the issue of Intellectnomics:
Several people have asked me for the meaning of Intellectnomics - a term I coined in 2020. This idea led to the formation of the Intellectnomics Research Group (IRG) in 2021. Intellectnomics is the economic analysis of non-corporeal goods and the associated entrepreneurial activities! Non-corporeal goods are intangible, non-physical, intellectual, knowledge based, and usually difficult to exclude other people from accessing. Examples are patents (technology, seed improvement or discovery, vaccines, and drugs), copyrights (books, music, and creative works), trademarks, and geographical indications (based on origin (location) with specific attributes and identification). Intellectual properties are different from corporeal goods like land and property, that are excludable and rivals in nature.
The development of new ideas is mostly based on inspirations that are ever present in the public domain but hidden in the nooks and crannies of the commons. These opportunities and their developments are usually seen and exploited by entrepreneurs. They usually turn an idea wandering in the commons into an original piece of work, a reflection of their ingenuity. This ingenuity needs to be protected if it doesn’t interfere with public welfare. In other words, intellectual property should be protected and compensated but not exploitative.
The Logic:
Imagine that ideas flow around in a market where there is no equilibrium because of entrepreneurial creative destruction (Schumpeter). This prevailing situation leads to equilibrating tendencies because players in the market try to out do one another (Kirzner). This rivalry leads to disturbances and asymmetric information in the market. If there's asymmetric information, the solution to obtaining desirable accessibility to information that is beneficial or at least Pareto efficient is to develop an appropriate definition and appreciation of property rights for non-corporeal goods. This should be context specific and ethical in terms of processes and procedures. Furthermore, since knowledge is tacit, people can absorb knowledge without realizing it. If they advance the knowledge, is there a possibility of infringement of intellectual property rights? Even though the idea seems to be common knowledge before it was strengthened by the entrepreneur, it may now be new. Moreover, if an entrepreneur improves an idea and makes it popular, there should be a way a player who adds value to the idea is compensated.
For example, suppose individuals A and B are musicians. If A produced some music in 1980 with little or no traction, suppose that the same music was sampled and improved by B in 2020 and it becomes a best seller and. global song. As alluded to by Takeyama, copying may extend and improve the usefulness of a piece of music. The only issue is that dissemination and usefulness should not be achieved at the expense of appropriate attribution of credit and compensation. In the Juju and Fuji genre of music, drummers, guitarists, acoustic players, and other instrumentalists all contribute original ideas to the recording of an album but are not necessarily given credit not even to talk about royalties. Our position is that all entrepreneurs, contributors of original ideas to the album, should be compensated for their contribution as defined by an enforceable contract. This is the reason why songwriters have rights in certain occasions even more than the record company and the performer. Examples of royalties that accrue to a songwriter are performance, mechanical, sampling, and synchronization royalties.
Explanation:
The future is knowledge based and we need to understand the nexus between entrepreneurship and intellectual property. It’s not surprising that some people have the impression that entrepreneurship cannot be taught in a formal setting. This is not necessarily true because a part of entrepreneurship, self-efficacy, can be advanced through formal training. The discovery and alertness to opportunities may arise from the environment, culture, religious affinity, and past experiences. The implication of these interactions is that people absorb knowledge without knowing. In other words, mistakes can be made and corrected.
To remain relevant, universities need to introduce courses that are futuristic with emphasis on transferable skills. If education is too expensive it can create a disincentive to acquiring formal education. How many people will take the risk to attend our universities and become indebted, possibly forever? In other words, people look at the rate of return when they plan to invest in education. Education should be relatively free if we want people to build skills that will make them creative and think outside the box. Otherwise, people will not want to study courses like philosophy, classics and music which are also important to wealth creation.
Exploration:
The Amen break, a drum break from the 1969 track – Amen, Brothers – by the Winstons is widely sampled music. In terms of covers, the most covered song is Yesterday, released in 1965 by the Beatles with more than 3000 covers. In the scenarios above the Beatles benefited from the covers made from their song in terms of visibility and royalties while the Winstons didn’t; in fact, the drummer (Gregory Coleman) died in penury. A major challenge of intellectual property rights (IPR) is that a residual will always be left in the commons. It is difficult to exclude other people from benefiting from the IPR. The cases of the Winstons and the Beatles indicate how difficult it is to benefit from intellectual property even when compensation is truly deserved. On another note, we have cases of IPR, especially patents, where it is used to exploit consumers. Examples of problematic use of patents include Turing Pharmaceutical’s increase of the price of Daraprim by 5000%, the exorbitant cost of anti-retroviral drugs in Uganda that was reduced (from $US16,000 to $US 100 per year) with the establishment of Cipla, a generic manufacturer, in Kampala, the price of Salvodi which is around $US 1000 in the US but $4 in India, and the initial lack of COVID-19 vaccines in developing countries during the COVID-19 pandemic.
The development of vaccines and high budget medications usually involves government funding in terms of direct expenditure on research and development, and capacity building. Furthermore, so-called original ideas usually stem from ideas already floating around in the commons or the public domain. Entrepreneurs, often because of their inquisitive nature, will be the first set of people to get inspired by their experiences and environment and then use it to further the human endeavor.
For example, ‘Yesterday’ was an inspiration from different sources. Even Sir Paul McCartney thought he had heard the song before it was released. Sir McCartney was wondering how he wrote ‘Yesterday’ because as alluded to in the introduction to this essay, inspiration came from the commons/public domain such as his experiences growing up, and songs such as Fred Astaire’s Cheek to Cheek (1935) and Nat King Cole’s 1956 version of ‘When I Fall in Love’ written by Victor Young and Edward Heyman in 1952. McCartney absorbed ideas from different sources without the ability to pinpoint the source of knowledge. So, it seems no one owns exclusive rights to intangible assets but instead it belongs to the collective.
Who owns IPR? What is the appropriate way to distribute compensation? Or maybe IPR belongs to all and is owned by none!
This is a glimpse into the problems Intellectnomics intend to solve …
Special thanks to my co-investigator, emeritus professor Glen Filson.
Bibliography
Adekunle, B. (2011) ‘Determinants of micro-enterprise performance in Nigeria’ International Small Business Journal 29(4), 360–373.
Adekunle, B. (2022). ‘Economics of intellectual property rights. Entrepreneurship and Intellectnomics’ series (Virtual and Global): Intellectnomics Research Group (IRG) and ECVOntario, University of Guelph, 15 January 2022.
Adekunle, B. (2024). International Trade (GMS 723) and Management of International Enterprise (GMS 724) lecture notes, Winter 2024. Toronto Metropolitan University (TMU): Toronto.
Adekunle, B., Kajumba, C. and Bello, A. S. (2024). ‘Hidden asymmetries: Enhancing trade through traceability, crypto-labelling and ethical property rights’ in Africa’s Trade Facilitation Preparedness and Ethical Property Rights. Pretoria University Law Press (PULP): Pretoria. Hidden Asymmetries
Adeyanju, B. (2024) AgbaletuTV. https://www.youtube.com/@deleadeyanju.
Cwik, B. (2016). Property rights in non-rival goods. The Journal of Political Philosophy, 24(4), 470–486.
Kirzner, I. (1997). Entrepreneurial discovery and the competitive market process: An Austrian approach. Journal of Economic Literature, 35(1), 60–85.
McCartney, P. and Muldoon, P. (2024). McCartney: A life in Lyrics: Pushkin. https://www.pushkin.fm/podcasts/mccartney-a-life-in-lyrics/yesterday.
Schumpeter, J. (1934). The theory of economic development. Cambridge, MA: Harvard University Press.
Takeyama, L. N. (1994). ‘The welfare implications of unauthorized reproduction of intellectual property in the presence of network externalities’ Journal of Industrial Economics 42:155-166.
Bamidele Adekunle |ECVOntario and Intellectnomics Research Group (IRG)|Canada
@badekunl
May 16, 2024
Dr. Adekunle, this was such an insightful read! In a knowledge-driven society, the idea of intellectnomics fundamentally changes our perspective on entrepreneurship. Your analysis of non-corporeal goods intrigued me; it demonstrates how innovation and intellectual property have come to be the primary factors behind modern value.
I found the Winstons and the Beatles to be a particularly interesting example of how, even when ideas are shared, recognition and compensation can vary. It brings up important concerns regarding equity and ethics in innovation.
Additionally, you addressed a valid point when you mentioned that the educational institution should emphasize creativity and transferable skills more. Today, this point of view seems so relevant. I appreciate you sharing this thoughtful article. It truthfully shifted my perspective on the relationship between knowledge and entrepreneurship.
- Yovana Puric
This is a great read, Daktari!
As a market researcher, I normally get to see how often ideas drive more value than the product itself. Your article captures the challenge of protecting those ideas while still keeping them open to fuel growth and innovation.