Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 1 # 1 The Wealth of Networks Ϫ1 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 2 # 2 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 3 # 3 The Wealth of Networks How Social Production Transforms Markets and Freedom Yochai Benkler Yale University Press Ϫ1 New Haven and London 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 4 # 4 Copyright ᭧ 2006 by Yochai Benkler. All rights reserved. Subject to the exception immediately following, this book may not be repro- duced, in whole or in part, including illustrations, in any form (beyond that copy- ing permitted by Sections 107 and 108 of the U.S. Copyright Law and except by reviewers for the public press), without written permission from the publishers. The author has made an online version of the book available under a Creative Commons Noncommercial Sharealike license; it can be accessed through the author’s website at http://www.benkler.org. Printed in the United States of America. Library of Congress Cataloging-in-Publication Data Benkler, Yochai. The wealth of networks : how social production transforms markets and freedom / Yochai Benkler. p. cm. Includes bibliographical references and index. ISBN-13: 978-0-300-11056-2 (alk. paper) ISBN-10: 0-300-11056-1 (alk. paper) 1. Information society. 2. Information networks. 3. Computer networks—Social aspects. 4. Computer networks—Economic aspects. I. Title. HM851.B457 2006 303.48'33—dc22 2005028316 A catalogue record for this book is available from the British Library. The paper in this book meets the guidelines for permanence and durability of the Committee on Production Guidelines for Book Longevity of the Council on Library Resources. 10987654321 STRANGE FRUIT By Lewis Allan ᭧ 1939 (Renewed) by Music Sales Corporation (ASCAP) International copyright secured. All rights reserved. All rights outside the United States controlled by Edward B. Marks Music Company. Reprinted by permission. Ϫ1 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 5 # 5 For Deb, Noam, and Ari Ϫ1 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 6 # 6 “Human nature is not a machine to be built after a model, and set to do exactly the work prescribed for it, but a tree, which requires to grow and develop itself on all sides, according to the tendency of the inward forces which make it a living thing.” “Such are the differences among human beings in their sources of plea- sure, their susceptibilities of pain, and the operation on them of differ- ent physical and moral agencies, that unless there is a corresponding di- versity in their modes of life, they neither obtain their fair share of happiness, nor grow up to the mental, moral, and aesthetic stature of which their nature is capable.” John Stuart Mill, On Liberty (1859) Ϫ1 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 7 # 7 Contents Acknowledgments ix 1. Introduction: A Moment of Opportunity and Challenge 1 Part One. The Networked Information Economy 2. Some Basic Economics of Information Production and Innovation 35 3. Peer Production and Sharing 59 4. The Economics of Social Production 91 Part Two. The Political Economy of Property and Commons 5. Individual Freedom: Autonomy, Information, and Law 133 6. Political Freedom Part 1: The Trouble with Mass Media 176 7. Political Freedom Part 2: Emergence of the Networked Ϫ1 Public Sphere 212 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 8 # 8 viii Contents 8. Cultural Freedom: A Culture Both Plastic and Critical 273 9. Justice and Development 301 10. Social Ties: Networking Together 356 Part Three. Policies of Freedom at a Moment of Transformation 11. The Battle Over the Institutional Ecology of the Digital Environment 383 12. Conclusion: The Stakes of Information Law and Policy 460 Notes 475 Index 491 Ϫ1 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 9 # 9 Acknowledgments Reading this manuscript was an act of heroic generosity. I owe my gratitude to those who did and who therefore helped me to avoid at least some of the errors that I would have made without their assistance. Bruce Ackerman spent countless hours listening, and reading and challenging both this book and its precursor bits and pieces since 2001. I owe much of its present conception and form to his friendship. Jack Balkin not only read the manuscript, but in an act of great generosity taught it to his seminar, imposed it on the fellows of Yale’s Information Society Project, and then spent hours with me working through the limitations and pitfalls they found. Marvin Ammori, Ady Barkan, Elazar Barkan, Becky Bolin, Eszter Hargittai, Niva Elkin Koren, Amy Kapczynski, Eddan Katz, Zac Katz, Nimrod Koslovski, Orly Lobel, Katherine McDaniel, and Siva Vaidhyanathan all read the manuscript and provided valuable thoughts and insights. Michael O’Malley from Yale University Press deserves special thanks for helping me decide to write the book that I really wanted to write, not something else, and then stay the Ϫ1 course. 0 ϩ1 ix Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 10 # 10 x Acknowledgments This book has been more than a decade in the making. Its roots go back to 1993–1994: long nights of conversations, as only graduate students can have, with Niva Elkin Koren about democracy in cyberspace; a series of formative conversations with Mitch Kapor; a couple of madly imaginative sessions with Charlie Nesson; and a moment of true understanding with Eben Moglen. Equally central from around that time, but at an angle, were a paper under Terry Fisher’s guidance on nineteenth-century homesteading and the radical republicans, and a series of classes and papers with Frank Michelman, Duncan Kennedy, Mort Horwitz, Roberto Unger, and the late David Charny, which led me to think quite fundamentally about the role of property and economic organization in the construction of human free- dom. It was Frank Michelman who taught me that the hard trick was to do so as a liberal. Since then, I have been fortunate in many and diverse intellectual friend- ships and encounters, from people in different fields and foci, who shed light on various aspects of this project. I met Larry Lessig for (almost) the first time in 1998. By the end of a two-hour conversation, we had formed a friendship and intellectual conversation that has been central to my work ever since. He has, over the past few years, played a pivotal role in changing the public understanding of control, freedom, and creativity in the digital environment. Over the course of these years, I spent many hours learning from Jamie Boyle, Terry Fisher, and Eben Moglen. In different ways and styles, each of them has had significant influence on my work. There was a moment, sometime between the conference Boyle organized at Yale in 1999 and the one he organized at Duke in 2001, when a range of people who had been doing similar things, pushing against the wind with varying degrees of interconnection, seemed to cohere into a single intellectual movement, centered on the importance of the commons to information production and creativity generally, and to the digitally networked environment in particular. In various contexts, both before this period and since, I have learned much from Julie Cohen, Becky Eisenberg, Bernt Hugenholtz, David Johnson, Da- vid Lange, Jessica Litman, Neil Netanel, Helen Nissenbaum, Peggy Radin, Arti Rai, David Post, Jerry Reichman, Pam Samuelson, Jon Zittrain, and Diane Zimmerman. One of the great pleasures of this field is the time I have been able to spend with technologists, economists, sociologists, and others who don’t quite fit into any of these categories. Many have been very patient with me and taught me much. In particular, I owe thanks to Sam Ϫ1 Bowles, Dave Clark, Dewayne Hendricks, Richard Jefferson, Natalie Jer- 0 ϩ1 Name /yal05/27282_u00 01/27/06 10:25AM Plate # 0-Composite pg 11 # 11 Acknowledgments xi emijenko, Tara Lemmey, Josh Lerner, Andy Lippman, David Reed, Chuck Sabel, Jerry Saltzer, Tim Shepard, Clay Shirky, and Eric von Hippel. In constitutional law and political theory, I benefited early and consistently from the insights of Ed Baker, with whom I spent many hours puzzling through practically every problem of political theory that I tackle in this book; Chris Eisgruber, Dick Fallon, Larry Kramer, Burt Neuborne, Larry Sager, and Kathleen Sullivan all helped in constructing various components of the argument. Much of the early work in this project was done at New York University, whose law school offered me an intellectually engaging and institutionally safe environment to explore some quite unorthodox views. A friend, visiting when I gave a brown-bag workshop there in 1998, pointed out that at very few law schools could I have presented “The Commons as a Neglected Factor of Information Policy” as an untenured member of the faculty, to a room full of law and economics scholars, without jeopardizing my career. Mark Geistfeld, in particular, helped me work though the economics of sharing—as we shared many a pleasant afternoon on the beach, watching our boys playing in the waves. I benefited from the generosity of Al Engel- berg, who funded the Engelberg Center on Innovation Law and Policy and through it students and fellows, from whose work I learned so much; and Arthur Penn, who funded the Information Law Institute and through it that amazing intellectual moment, the 2000 conference on “A Free Information Ecology in the Digital Environment,” and the series of workshops that be- came the Open Spectrum Project.