The Tragedy of the Anticommons: A Concise Introduction and Lexicon

AuthorMichael Heller
Date01 January 2013
DOIhttp://doi.org/10.1111/1468-2230.12000
Published date01 January 2013
ARTICLES
The Tragedy of the Anticommons:
A Concise Introduction and Lexicon
Michael Heller*
This article gives a concise introduction to the ‘tragedy of the anticommons. The anticommons
thesis is simple:when too many people own pieces of one thing, nobody can use it.Usually,pr ivate
ownership creates wealth.But too much ownership has the opposite effect – it leads to wasteful
underuse.This is a free market paradox that shows up all across the global economy. If too many
owners control a single resource,cooperation breaks down,wealth disappears, and everybody loses.
Conceptually,underuse in an anticommons mir rors the familiar problem of overuse in a ‘tragedy
of the commons.’The field of anticommons studies is now well-established. Over a thousand
scholars have detailed examples from across the innovation frontier, including drug patenting,
telecom licensing, climate change,compulsor y land purchase, oil field unitisation, music and art
copyright, and post-socialist economic transition.Fixing anticommons tragedy is a key challenge
for any legal system committed to innovation and economic growth.
Some years ago, a drug company executive presented me with an unsettling
puzzle. His scientists had found a potential treatment for Alzheimer’s disease,but
they couldn’t develop it for the market unless the company bought access to
dozens of patents. Any single patent owner could demand a huge payoff; some
blocked the whole deal.This story does not have a happy ending.The drug sits
on the shelf though it might have saved millions of lives and earned billions of
dollars.1
Here’s a second high stakes puzzle:what’s the most underused natural resource
in America?The answer may be a surprise. It’s the air waves. Over 90 per cent is
dead air because ownership of broadcast spectrum is so fragmented. As a result,
America’s information economy is relatively hobbled; wireless broadband capac-
ity lags far behind that in Japan and Korea.The cost of spectrum underuse may
be in the trillions.
And another puzzle: why do we waste weeks of our lives stuck in airpor ts? Bad
law for real estate assembly. InAmerica, air travel was deregulated thirty-five years
*LawrenceA.Wien Professor of Real Estate Law,Columbia Law School.This article is adapted from the
41st Annual Chorley Lecture given at the London School of Economics,12 June 2012 (finally revised
10 October 2012).The article draws substantially from the Preface and from Chapter 2 of M.A. Heller,
The Gridlock Economy: HowToo Much Ownership Wrecks Markets,Stops Innovation, and Costs Lives (New
York: Basic Books, 2008).
1 The fullest account of anticommons theory and solutions appear s in The Gridlock Economy ibid.On
the anticommons in drug patents, see ibid 4978 (chapter 3);in telecom, see ibid 79–106 (chapter
4); in land, see ibid 107–142 (chapter 5). See also M. A. Heller (ed), Commons and Anticommons
(Cheltenham, UK: Elgar Publishing, 2011) (collecting and reprinting, in two volumes, the key
scholarly articles on the theory and economics of commons and anticommons property).
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© 2013The Author.The Modern Law Review © 2013The Moder n LawReview Limited. (2013) 76(1) MLR 6–25
Published by BlackwellPublishing, 9600 Garsington Road, Oxford OX42DQ, UK and 350 Main Street, Malden,MA 02148, USA
ago.The number of fliers has tripled. So how many new airports have been built
since 1975? One. Denver.You can’t build new airports, not anywhere, because
multiple landowners can block every project. Twenty-five new runways at
America’s busiest airports would end most routine air travel delays in the country.
Imagine that.
All these puzzles share a common cause: when too many people own pieces
of one thing, nobody can use it.The anticommons thesis is that simple:when too
many people own pieces of one thing, nobody can use it. Usually, private
ownership creates wealth. But too much ownership has the opposite effect – it
leads to resource underuse in an anticommons.This is a free market paradox I
discovered and it shows up all across the global economy. If too many owners
control a single resource, cooperation breaks down, wealth disappears, and
everybody loses.
There has been an unnoticed revolution in how we create wealth. In the old
economy, twenty or thirty years ago, you invented a product and got a patent;
you wrote a song and got a copyright; you subdivided land and built houses.
Today, the leading edge of wealth creation requires assembly. From drugs to
telecom, software to semiconductors, anything high-tech demands the assembly
of innumerable patents. And it’s not just high tech that’s changed – today,
cutting edge art and music are about mashing up and remixing many
separately-owned bits of culture. Even with land, the most socially-important
projects, like new runways, require assembling multiple parcels. Innovation has
moved on, but we are stuck with old-style ownership that’s easy to fragment
and hard to put together.
Fixing anticommons tragedy is a key challenge for our time. Some solutions
are entrepreneurial; for example, people can profit from finding creative ways to
bundle ownership.Philanthropists can assemble patents for disease cures. Political
advocacy and legal reform will be needed to secure solutions. But the first and
most important step in solving anticommons tragedy is to name it and make it
visible. This article takes that step by briefly introducing the anticommons
lexicon. With the right language, anyone can spot links among anticommons
puzzles, and all can come together to fix them.
COMMONS AND ANTICOMMONS
To understand the dilemma of resource underuse in an anticommons, it is helpful
to start with overuse in a commons.Aristotle was among the first to note how
shared ownership can lead to overuse: ‘That which is common to the greatest
number has the least care bestowed upon it . . . each thinks chiefly of his own,
hardly at all of the common interest; and only when he is himself concerned as
an individual.2
2 Ar istotle, The Politics and the Constitution of Athens (S. Everson (ed), B. Jowett (trans) Cambridge:
Cambridge UP, 1996) 33. Before Aristotle, Thucydides noted that people ‘devote a very small
fraction of time to the consideration of any public object,most of it to the prosecution of their own
objects. Meanwhile each fancies that no harm will come to his neglect, that it is the business of
Michael Heller
© 2013 TheAuthor.The Moder n Law Review© 2013 The Modern Law Review Limited. 7
(2013) 76(1) MLR 6–25

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