Here’s a work in progress abstract that I am currently writing up:
The entrepreneurial problem is one of knowledge coordination under uncertainty. This process consists of search, discovery, and action. The goal of the entrepreneur is to determine the viability of a particular innovation and thus reduce private uncertainty about the opportunity they imagine. The innovation resources to solve this problem, particularly at the beginning of a trajectory, exhibit some peculiar properties: they are dispersed about the economy in individual minds; they are uniquely of the ‘you don’t know it until you see it’ kind; and are likely to exhibit diminishing returns the more minds possess it. Combining institutional and evolutionary economics, as well as the commons literature, we are led to a new solution to the entrepreneurial problem: the ‘innovation commons’. Unlike conventional economic solutions, this is a collective action solution rather than an allocative one. We propose that the innovation commons exist where entrepreneurs pool their technology and knowledge resources, and govern as a common pool resource. This ties in with existing commons literature of how individuals deal with uncertainty (in rainwater falls, for example, the commons presents an institutional solution as a form of social insurance). Finally, we present a number of theories over what may be occurring here and what the innovation commons look like: they are temporary in nature (if they are successful they will disappear); they are likely to emerge more readily as transaction costs fall (hence the emergence of the innovation commons only now); and they may have a defensive function against alternate institutions.