Today at George Mason University School of Law there was a debate between Michael Heller, author of the new book, The Gridlock Economy, and University of Chicago School of Law Professor Richard Epstein.
Michael Heller opened the debate with the idea that when too many people own pieces of one thing, nobody can use it. Ownership structure, not just private property rights per se, are what is important. Too much ownership (fragmented, badly designed, or mis-specified ownership rights) creates gridlock and this is one of the biggest problems in the modern economy. Using examples from modern mortgage securitization and foreclosure to gene therapy to telecom, Michael Heller made his case for the pervasive impact of the tragedy of the anticommons (wasteful underuse). His solution is to update our old-style laws for our new-style economy.
Richard Epstein began his statement by re-titling the book The Gridlock Economy: How Too Much Government Wrecks Markets, Stops Innovation, and Costs Lives. Returning to the robber-baron example from the book, Epstein contends that it is often government-made mistakes that create gridlock, as on the Rhine. He listed three overlooked government interventions that lead to gridlock: over-subsidization of unprofitable activities, over-regulation of market activities, and wealth re-allocation. He went on to allocate 10% of the gridlock problem to the anticommons, leaving 90% to government intervention. He concluded by addressing the issues Michael Heller brought up in his opening remarks and demonstrated the role of government intervention in creating gridlock in the mortgage, drug, telecom, and other industries. Epstein recommended returning to a system of private property rights and a fair and coherent system of eminent domain.
Every week we bring you in-depth interviews with leading thinkers and entrepreneurs from the world of technology. The most recent episode features 