What Would a Nanotech Economy Look Like?
School of Law, Santa Clara University
In its early stage, nanotechnology is one more way of making useful materials. A mature molecular nanotech, complete with general purpose assemblers, is more than that. Not only does it have the potential for making a wide range of useful things, its way of making them is different in economically as well as technologically interesting ways. Molecular manufacturing, once fully developed, may have many of the features that distinguish the software economy, raising some of the same issues.
One important feature is the combination of high fixed costs of original design with low marginal costs of producing additional instantiations of that design. As with software, this is likely to lead to an economy characterized by sequential rather than simultaneous competition—a single dominant product in each niche, maintaining its position until displaced by a better alternative. As with software and many other things, we would expect to observe monopolistic competition—a dominant product at a particular location in characteristic space competing with a dominant product at a nearby location for customers whose ideal point is intermediate between them.
A second feature which nanotech may share with software is easy duplication by others. If it proves possible to create disassemblers and impractical to create designs resistant to disassembly, the original designer of a nanotech device will face problems analogous to software or music piracy. This raises a familiar issue—how to make it worth bearing the initial fixed cost if the producer cannot maintain ownership over his design. Possible solutions range from intellectual property law to embedded advertising to open source design.
A third feature, shared with both software and biotech, is the risk that the technology could be used for malevolent purposes with a high ratio of damage done to cost of doing it. Possible responses include legal restrictions on the technology, counter measures privately produced and sold on the market, and publicly produced countermeasures.
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