The end of the cash nexus

Over at Crooked Timber, John Quiggin has some thoughts on what new technologies and organization means for innovation and consequently for the market:

There has been a huge shift in the location of innovation, with much of it either deriving from, or dependent on, public goods produced outside the market and government sectors, which may be referred to as social production.

Some suggestions, not fully argued, over the fold

*If monetary returns are weakly, or even negatively correlated with the value of social production, there’s no reason to expect capital markets to do a good job in allocating resources to supporting innovation. (This point seems rather less controversial than when I made it in 2006.)

*As a corollary, it seems unlikely that large inequalities in income are beneficial to anyone except the recipients of high incomes (this issue is being discussed, in a much more abstract setting, at Crooked Timber)

*If improvements in welfare are increasingly independent of the market, it would make sense to shift resources out of market production, for example by reducing working hours.

See also here.