The Gridlock Economy: How Too Much Ownership Wrecks Markets, Stops Innovation, and Costs Lives

Michael Heller's Gridlock Economy is this year's must-read popular economics book. As reviewers at Slate, Time, and elsewhere have noted, Heller's book compares well to 2005's mega-hit Freakonomics, as well as Malcolm Gladwell's Blink, James Surowiecki's (of The New Yorker) The Wisdom of Crowds, and Chris Anderson's The Long Tail. Gridlock Economy shares two important characteristics with those books: a compelling central organizing idea and great writing. The central organizing idea is that "too much ownership" can stifle economic innovation. By "too much ownership," Heller is referring to the kind of situation that arises with increasing frequency across all the key sectors of the new economy including biotechnology, software, computer hardware, music, movies, and finance. Our efforts to promote innovation by granting patents and copyrights (and other government-sponsored forms of intellectual property protection) can often come back to bite us. Heller provides dozens of interesting examples across the entire range of the new economy. His lead example involves the difficulties that a researcher at a big drug company is having pursuing a promising cure for Alzheimers. To make headway, the researcher needs to purchase or license a host of patents held by a not small number of competitors. Our current patent system gives --for better and, in this case, for worse-- gives each patent holder involved the capacity to hold up this important research. If we're lucky an entrepreneurial "patent bundler" will come along and piece together the necessary patents and licenses. Meanwhile, we're stuck in Heller's gridlock.

There are an awfully lot of good books on the economics of private ownership out there. What makes this one special is it really takes apart what has become the most underreported and underestimated side of inefficiency, and that is property being broken into units so small, they aren't of use anymore. This is important, for example, because it has hindered medical innovation, by forcing people to wait out a nearly endless stream of patents before developing a new drug to combat, say, alzheimer's. Another big positive of the book is it's nice to give credit where credit is due, and Heller invented the study of this stuff. It's great to hear it right from the horse's mouth. And, what is definitely most important, it is accessible to any audience. If you are just leaving high school and want to know a good collection of injustices created by capitalism run amok, you would want this book. If you are a free-market economist (or a college econ student) and want to have a thorough understanding of this form of inefficiency, you would want this book. But I think this book is best for people that look around and feel like the country has so much potential, so much brainpower, and technological ingenuity, and yet for some reason our economy is on life support. There are a lot of books that point fingers at the failures of officials, and businesses, and individuals, etc. This one not only defines problems but points to solutions, something you almost NEVER come across in popular reading today. A great read all around.

I picked up the book yesterday and could not put it down. I was captivated by how well written this book is for a layman with a generic knowledge background in business. I especially enjoyed the organization in snippets that I could read. I kept saying okay, I'll read two more and I'd find myself having read seven more at that first sitting. I finished it this morning but will re-read it more carefully for a later review but for now it is a mid-5 star review.

This book is a great introduction to a very interesting topic, written in a way that is easily accessible and understandable both for those in the legal field and those without any legal background at all. Heller skillfully takes readers on a journey through the many areas of life, both historical and contemporary, that are or have been affected by this concept of the anti-commons. Just a few examples include Heller's discussions about robber barons blocking travel through water channels by collecting tolls every few miles, to the difficulties of obtaining rights to music from numerous different owners to create rap songs with mixed samples, to the inhibitory effects on the development of medical treatments because of too many owners owning tiny bits of gene sequences. It is an eye-opening book, and one that everyone should read.

If you want to understand and make use of a central puzzle at the heart of medical innovation, creative arts, telecomm (and many others), read Heller's new book. His key insight--in academic jargon known as the tragedy of the anti-commons--is that our old-fashioned ways of managing ownership frequently get in the way of creating wealth (and innovation) in the new economy. Heller illustrates his observation--that in some cases there is such a thing as too much private property--with a jazillion well-researched examples that take you to the interior of big pharma, telecomm, software, and the like. The scope of his examples is breathtaking--and ultimately personal. His solutions run the gamut but focus largely on entrepreneurship...except that it is entrepreneurship informed by recognizing the opportunities and risks of gridlock that are outlined in his book (as well as his articles in Science, Harvard Law Review, and elsewhere). This is a well-written book that is a pleasure to read and a real page-turner.