The Labour Theory of Knowledge & Its Corollary:
The Knowledge Theory of Capital
Harry Hillman Chartrand, March 2003
Richard Vanderberg & JSTOR
Economics, as part of the Humanities & Social Sciences (HSS), is not just about mathematical precision; it is also about retracing the voyages made by economists over some four centuries of discovery. In many cases captains and crews never returned to be marooned forever in intellectual cul de sac. Sometimes, however, their voyages can be retraced and the discoveries of these early explorers, from time to time, added to mainstream thought: witness the ‘New’ Classical Economics, the ‘New’ Institutionalism and revivification of Schumpeterian ‘creative destruction‘(1950). And sometimes, the ancient voyages of even those who succeeded in returning and reshaping the mainland of economic thought may profitably be retraced and their findings reinterpreted.
In this paper I will do just that for Adam Smith’s labour theory of value. I will first sketch an overview of labour during the life and times of Adam Smith. I will then reconsider his views about the division and specialization of labour, laissez passer and his labour theory of value itself. My historical observations are drawn primarily from the works of J. R. Commons (1924), W. B. Houghton (1941, Jan. & Apr. 1942, 1952); Emma Rothschild (2001), W.J. Samuel (1961; 1962), J. A. Schumpeter (1954), H.F. Thompson (1965) and Edgar Zilsel (1940a, 1940b, 1941, 1942, 1945).
Based on this reinterpretation I will propose an economic epistemology, i.e., a theory of knowledge, one intended to be consonant with Smith and with the findings of analytic psychology (Hillman 1980, 1981; Jung 1953-1979; Neumann 1954; Sharp 1991). I will then apply this epistemology to generate a taxonomic foundation for a labour theory of knowledge. Taxons will include:
· three dominant contemporary and institutionalized knowledge domains – the Natural & Engineering Sciences (NES), the Humanities & Social Sciences (HSS), and the Arts;
· three generic categories of intellectual property rights (IPRs) that temporarily convert knowledge into property that may be bought and sold in markets – designs & patents, copyrights & trademarks, and know-how & trade secrets – before entering the public domain forever;
· three material forms in which knowledge must be fixed for IPRs to exist – utilitarian and non-utilitarian matrices as well as the person – natural and legal; and,
· three types of knowledge markets – the markets for tacit, codified and tooled knowledge.
I will argue the strong and weak interactions of component parts of the taxonomy (Figure 1: vertical vs. horizontal) to illustrate its descriptive meaningfulness and explanatory power. I apologize before hand for some repetition and use of terms not currently part of the economic lexicon. These include: circular causality derived from neurophysiology, primary and secondary master/slave configurations derived from computer science; and, my neologism, tooled knowledge. I also revivify terms once familiar to the economic trade of Smith’s day like Reason, Revelation, Sentiment and Sensation. Furthermore, unless otherwise specified, general definitions and etymology (origin of words) are derived from the Merriam Webster Dictionary On-Line.
It is not my intention to revivify the labour theory of value nor displace the Neo-Classical solution but rather to compliment them. I intend to retool the theory as a labour theory of knowledge and expose its corollary – the knowledge theory of capital. Thereby I hope to make a contribution towards resolving the contemporary incommensurability of knowledge (Kuhn 1996). This is the shadow side of division and specialization of labour in a knowledge-based economy; a wraith that Adam Smith, as we will see, foresaw. The dark side of “good paradigms make good neighbours” (Fuller 2000; 7) is evident in the near apocalyptic twentieth century clash between Marxism and Markets – both paradigms of economic thought with the labour theory of value as the theoretical bone of contention.
Adam Smith (1723-1790) can justly be called ‘the great mariner’. It was he who first navigated the limits of economics using what was, in his day, a branch of moral philosophy destined to become the first ‘social’ science - political economy. Economics, as a discipline of thought or “a recognized field of tooled knowledge” (Schumpeter 1954: 143) is generally dated from the 1776 publication of Smith’s The Wealth of Nations. The foundation for Smith’s concept of knowledge, however, was laid down in his other great work, The Theory of Moral Sentiments, published in 1759.
With time, some of Smith’s findings have become axiomatic in economics; others, have slipped into its murky depths waiting to be recovered by some adventurous intellectual archaeologist. What fell, or was thrown, into the waters partially reflects the reactionary forces dominating political life after Smith’s death until the fall of empires in 1918. During his own life, he was considered, by many, a dissident, a friend of French économistes, a Jacobin, a revolutionary.
Quoting Rothschild about the pre-revolutionary reception of The Wealth of Nations:
… some weeks before it was first published in London in March 1776. “Here is a strange adventure,” the abbé Morellet wrote to Turgot on February 26; he relates that as he was waiting, earlier in the day, for the proofs of his translation of “the piece by Mr. Smith” - a section of the early chapter of the Wealth of Nations dealing with corporations and apprenticeships - he received news that the manuscript had instead been seized by the police, and was deemed to be worthy of burning. (Rothschild 2001, 87)
Smith wrote just as the republican revolution in America (1776) was overthrowing a feudal order of subordination - an order in which some were created superior and others inferior by birth. The Declaration of Independence (1776) overthrew this old order with its premise: “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”
Smith also lived to see the second republican revolution in France overturn its Ancien Regime of privilege replacing it with one of ‘liberty, equality and fraternity’. He did not, however, unlike Bentham, live long enough to see both betrayed – in the first, by limiting the definition of ‘men’, and in the second, by self-righteous revolutionary zeal excusing terror as an instrument of freedom.
Nonetheless, the view of the individual as the foundation stone of political life was shared by Smith and was consonant with his view of the individual as the foundation of economic life. In his day, there was in fact only one life. Politics and economics were, according to Smith, incestuously entwined - political power converted to economic profit and profit to power. The regime of privilege in the form of feudal ‘corporations’ including the Church, mastership guilds, towns and trading corporations was a fundamental impediment to the wealth of nations because it inhibited the individual in pursuing one’s self-interest rather than that of a lord, lady or other superior.
Following the defeat of the French Revolution, the Congress of Vienna in 1815 created what was known as the ‘Holy Alliance’ of European monarchies to reinstate political and social subordination and repress republican sentiment among the population. In Britain (and America), however, Adam Smith’s successors successfully argued for business enterprise to be set free from the remaining regulatory vestiges of the pre-revolutionary order. In effect, economic life was to be divorced from political life. Political power was no longer to be converted into private profit, nor was private profit to be the source of political power – in theory.
In fact, the process had begun in England with the 1624 passage of the Statute of Monopolies to abolish the power of the guilds. A guild was, of course, a centre of specialized knowledge called a ‘trade’ or ‘mystery’ (Houghton 1941). The Statute of Monopolies was the first step in a long evolutionary process whereby Common Law courts progressively stripped the guilds, with one notable exception – the printer’s - of monopoly power and assumed responsibility for their regulation.
To quote J.R. Commons about the development of business law in the Anglo-American Common Law tradition from the time of the Statute of Monopolies:
The next hundred years, until the Act of Settlement in 1700, was substantially the struggle of farmers and business men to become members of the Commonwealth, whereby they might have courts of law willing and able to convert their customary bargains into a common law of property and liberty. The court which abolished the power of the gilds began to take over the work of the gilds. Their private jurisdiction became a public jurisdiction. And the very customs which the gilds endeavored to enforce within their ranks became the customs which the courts enforced for the nation. The monopoly, the closed shop, and the private jurisdiction were gone, but the economics and ethics remained. Much later, in the modern commonwealth, other functions of the gilds, such as protection of the quality of the product and the qualifications of practitioners, have also been taken over by courts or legislatures. (Commons 1924: 230)
One economic axiom derived from Smith is that ‘the division and specialization of labour is limited by the extent of the market’. Both imply knowledge. In the first instance, ‘know-how’ is required in the division of the production process and, in the second, specialized skills are required to efficiently realize an ever increasingly complex production process. Division and specialization of labour are one of the cornerstones of the Wealth of Nations.
To Smith, however, gains had to be carefully counted against costs including what Marx would later call ‘alienation from the means of production’. For Smith, the answer was public education. The dialogue of the marketplace as well as of the political arena required the ability to read, write and account on the part of all citizens. Quoting Rothschild:
Smith is insistent, from the beginning of the Wealth of Nations, on the equality of natural talents. The difference between the philosopher and the common street porter, he says, “seems to arise not so much from nature, as from habit, custom and education. When they came into the world, and for the first six or eight years of their existence, they were, perhaps, very much alike.” Their “very different genius,” as adults, is the consequence of the division of labor more than its cause. People are not born “stupid and ignorant” but are made so by their “ordinary employments”; by the simple, uniform nature of the work they can get; and by the circumstance that their parents, who “can scarce afford to maintain them even in infancy,” send them out to work as soon as they can. (Rothschild 2001, 87)
Moving from the division and specialization of labour to that of knowledge, the market has now extended to global proportions. And, as Smith implied, there has been a narrowing of breadth and an increasing of depth with the individual becoming increasingly atomized, alienated or simply disinterested in all but a narrowing horizontal range of the knowledge spectrum. This is evident in the Natural & Engineering Sciences (NES) where ‘normal science’ involves a puzzle-solving attention to a smaller and smaller field of vision (Kuhn 1996). This has led to the problem of incommensurability of knowledge compounded by the problem of ‘just keeping up’. It is also evident in the Arts where the Art-for-Art’s-Sake Movement, a child of the Industrial Revolution (Henderson 1984) has generated an ever moving, shifting and changing avant garde (Bell 1976) spinning out increasingly esoteric aesthetic messages intended for ever smaller audiences, e.g., for atonal music and labels larger than pictures as described in Tom Wolfe’s The Painted Word (Wolfe 1975).
Another economic axiom generally attributed to Smith is laissez faire – loosely translated as: let them do what they want, or more specifically, non-governmental intervention in the marketplace. While the sentiment is Smithian, the term itself originates with his French colleagues – the Physiocrats (Samuels 1961, 1962). A fuller statement is, to quote Samuels:
It is laissez faire, laissez passer, meaning thereby freedom to do, or freedom to make, and freedom to pass; or, as Marshall put it, “let people make whatever they like and move wherever they like.” (Samuels 1962, 157).
From before Elizabeth I and the Statute of Artificers of 1563, there had been severe periodic labour shortages in England caused by disease (including the plague) and the first English civil war – the War of the Roses - that placed the Tudors on the throne. In such unsettled times feudal control tended to breakdown and labour, especially skilled labour, tended to move where wages were highest. To maintain feudal control, the Statute of Artificers established a statutory apprenticeship system replacing the crumbling medieval one in which journey men increasingly left their masters for greener pastures. The Statute set maximum wage rates, established residency requirements, and was intended to instill a sentiment of subordination. It was against this system - and parallel statutory privileges granted to churches, trading companies, merchants, incorporated towns and cities - that Smith protested. In 1814, however, it was only government enforced restrictions on the movement of labour that were replaced when a ‘voluntary’ apprenticeship system was introduced (Rothschild 2001, 90).
In short order, the guild system collapsed and the labour market became flooded with unskilled workers. The successful innovation of the industrial factory system meant, however, that Britain quickly became the lowest cost producer of many goods, especially textiles. The top end of that market, however, continued to be dominated by mills in Lyons, France and Munich, Germany. By 1835 the quality of ‘high end’ British textile production had declined to the point that the British Board of Trade appointed a Select Committee to investigate the problem and recommend remedies. It called for the marriage of art and industry to enhance English competitiveness with European rivals. The result was creation of the first school of design in South Kensington in 1836. It is interesting to note that the curriculum of the new school was designed to insure that no craftsman would ever aspire to become an artist. Artists were gentlemen who attended the Royal Academy of Art (Savage 1985). This distinction between the crafts and the arts continues a much older schism in Western culture between the Mechanical and Liberal Arts, of which more below.
Later in the 19th century, however, after abrogation of subsequent Conspiracy Acts that made trade union membership a crime, the guilds returned in the guise of craft, industrial and trade unions. Like the original guilds, these organizations represented labourers possessing specialized knowledge and skill.
Before Adam Smith, the political economic concept of labour was defined by reference to a feudal system in which all grades and classes of labour and all other forms of property were, ultimately, subject to a Monarch while the soul of the labourer was entrusted to the tender care and mercies of a Church with a monopoly on revelation. The resulting ‘caste system’ also embraced a more ancient division of labour between the Liberal and Mechanical Arts. From the time of the ancient Greeks when slavery was first introduced through the Roman Empire into the Christian Middle Ages and up to the Renaissance, those who worked with their heads practiced the Liberal Arts; those who worked with their hands, the Mechanical. In essence, the first were considered ‘ennobling’; the second, ‘demeaning’. It is interesting to note that writing was considered a mechanical art in the ancient and medieval worlds. It was something a ‘gentle’ person did not do; it was for scribes (Fuller 2000, 46).
It took the 15th century artist/engineer/humanist/scientist genius of Da Vinci, Dürer, Michelangelo and their kin to begin bridging this ancient chasm. An additional span was laid by their successors in the 16th and 17th centuries – high artisans and instrument makers - whose ‘experimental method’ inspired Francis Bacon and fuelled the ‘Scientific Revolution’ (Zilsel 1945).
With Smith, and the republican ethos of the American and then the French Revolutions, the labourer (Liberal and Mechanical) became free of feudal ownership and religious intolerance. In economic theory or moral philosophy as it was then called, the value of goods and services was rooted by Smith, among others, in a ‘labour theory of value’. Smith’s theory quickly eclipsed older exchange, scarcity and use value theories. It was the time, effort and skill of labour (and wages – the higher the better according to Smith for the wealth of nations) that determined the ‘just price’ of a good or service in the marketplace.
Even Capital, as physical plant and equipment, was subsumed under the labour theory by Bohm-Baverk and the Austrian School. In essence, capital was historically embodied labour using ‘round-about’ methods of production (Blaug 1968, 510-11). How to measure labour content of a good as well as historically embodied labour in capital was not, however, convincingly answered (Dooley 2002).
The labour theory of value maintained theoretical dominance for nearly a century until the Marginalist Revolution of the 1870s and innovation of the Marshallian Scissors of supply and demand. Marshall rejected the labour theory in favour of what can be called a modified theory of exchange involving equilibrium between:
The labour theory of value continued, however, as the foundation stone of Marxist economic thought and fueled the Communist Revolutions of the 20th century. To appreciate the importance of the theory, one may look at the ‘Cold War’ that geopolitically divided the planet into two armed camps threatening global ‘mutually assured destruction’, or MAD, for nearly half a century. One camp believed that capital, as private property, was the foundation stone upon which ‘hired’ labour - through its division and specialization – transformed natural resources (or ‘dumb nature’) into commodities of use and value to a ‘sovereign’ consuming public. The other believed that ‘sovereign’ labour was the only productive asset and ‘capital was theft’. On this dispute the life and death of human civilization, as well as the biosphere of the planet, lay beneath a nuclear sword of Damocles dangling on an elliptical trajectory with a fifteen minute warning.
The triumph of market price over Marx as a ‘theory of value’ – equating the ‘willingness’ of consumers to buy and producers to sell – occurred at a time, however, when the ancient distinction between the Liberal and Mechanical Arts resurfaced in a new strain – management versus labour. In effect, labour worked with its hands; management worked with its head.
While a satisfactory theory of capital never emerged from the Classical School of Adam Smith or the Neoclassical School, the idea of a single owner of capital directing production was, and remains, an elementary assumption of the economic theory of the firm. Growth and development of the limited liability corporation, however, spread capital ownership wider and wider (contra Marx) to embrace more and more ‘shareholder’ owners. This, in turn, led to a separation of ownership and control first formally noted by Berle & Means (1932) with the concomitant emergence of a new class of labour called ‘management’. This new class exercised the prerogatives of ownership as hired agents (employees) of shareholders. That the ‘agency problem’ in economics has not been solved is evident in the recent wave of corporate scandals, e.g., Anderson, Enron, Tycho, Worldcom, et al.
But why should one class of labour ‘work’ and another ‘manage’? This was the subject of Richard Bendix’s historically exhaustive Work and Authority in Industry: Ideologies of Management in the Course of Industrialization (1956; 1976; 2001). Bendix traces the conceptual history of modern management back to feudal times. He finds, in effect, a theory of positive thinking: managers have a positive self-image and can defer gratification while workers do not and cannot do the same. Bendix captures, perhaps, the last embers of the Classical ‘Iron Law of Wages’. Classical economics viewed, with relative equanimity, the starvation of the labourer who must then accept lower real wages and who, alternatively, with higher real wages simply bred increasing the labour supply thereby lowering real wages through competition. Full employment, under the Classical model, was assured on the backs of labour, or what Marx called “the surplus army of the unemployed”.
John Kenneth Galbraith in his New Industrial State (1967) went further and described the modern corporation as governed by a self-replicating technostructure of managers (produced by and selectively chosen from among graduates of so-called ‘B’ or business schools) who then direct ‘workers’ on behalf of an ever increasingly and diffuse pool of shareholder-owners. Galbraith also explored the relationship between large corporations and a newly emerging class of labour - creative talent, specifically artists (Economics & The Public Purpose, 1973). While the classless genius may have emerged with the Renaissance’s artist/engineer/humanist/scientist, by definition, it is exceptional and has not, historically, constituted a distinct class of labour.
By the late1960s, however, as a result of mass post-war, post-secondary education, an historically large demographic cohort of talent became available to both arts and science-based industries. By the 1980s and 1990s observers such as Robert Reich in The Work of Nations (1992) recognized that the displacement of manual workers by automation and computerization (together with increasing Third World ‘off-shore’ production) was creating a new class of American symbolic workers, i.e., those who manipulate words, numbers, visual and other recorded images and sounds. The most recent wave of talent include so-called ‘biotech stars’ responsible for the emergence of a whole new sector of the economy – biotechnology (Zucker et al, 1998).
The mainstream economic concept of labour holds one additional and inherent bias. Other traditional factors of production – capital, entrepreneurship and natural resources – can reasonably be assumed fixed in the short-run; labour is the variable factor to be adjusted to maximize profits. Calculation of the Newtonian equilibrium for constrained profit maximization, however, becomes problematic when the variable is volitional.
In his 1998 article “Beyond the Information Revolution”, Peter Drucker captures the dilemma of shareholders and management in dealing with the new knowledge worker. Bribes in the form of stock options will not suffice, Drucker concludes. The old schism between management and labour, between the Liberal and Mechanical Arts, between geeks and suits, according to Drucker, must be healed through respect based on mutual need:
Increasingly, performance in these new knowledge-based industries will come to depend on running the institution so as to attract, hold, and motivate knowledge workers. When this can no longer be done by satisfying knowledge workers’ greed, as we are now trying to do, it will have to be done by satisfying their values, and by giving them social recognition and social power. It will have to be done by turning them from subordinates into fellow executives, and from employees, however well paid, into partners. (Drucker 1998, 57)
Epistemology is the study of the nature, origin and limits of human knowledge. The word derives from the Greek epistama (knowledge) and logos (reason). The field is also called the theory of knowledge (Stroll & Martinich 2003). For our purposes, it involves two elemental questions. First, how does one, as a physical being, know? This can be called the ‘hardware’ question. And, second, how does one, as a mental being, know? This can be called the software question.
It was only in the 20th century that the hardware question was meaningfully addressed by neurophysiology – the study of the brain and nervous system. In simple terms, the human brain has been subject to a three-stage evolutionary process. First, there came the so-called Reptilian Brain whose nature was the subject of Carl Sagan’s The Dragons of Eden (1977). Sometimes called the ‘rectilinear or R-structure’ it includes the brain stem made up of specialized organs such as the medulla oblongata and the eye. It receives sensations from the nervous system – voluntary and involuntary - and regulates the involuntary system. Second, overlaying this primitive vertebrate brain is the Mammalian Brain or cerebellum with its distinctive lobes – left/right, front/back. Finally, like wrapping paper enfolding the previous two, is the cerebral cortex, the grey ridged matter sometimes called ‘the human brain’ but which we, as a species, share with higher primates, whales and dolphins.
Research over the last hundred years has revealed a lateralization of brain function. In the most general and uncontroversial terms: the left lobe is responsible for speech; the right lobe for pattern recognition, the front or temporal lobes for higher brain function like reason and planning; the back or occipital lobes for human visualization, i.e., not just physical sight but also mental imagining.
More controversial are the findings of Wilder Penfield (1975) and Julian Jaynes (1978). Penfield after fifty years of neurosurgery concluded that the brain stem contained what he called the centrencephalic system, or programmer of the human computer. Thus, if different parts of the brain were damaged, particularly prenatal, the programmer could reassign tasks altering the normal pattern of functional lateralization.
In the case of Jaynes, his career as a neuropsychologist led him to believe that a right lobe
centre corresponding to Wernicke’s Area in the left lobe (one of three speech centres) was once active.
Dormant in contemporary humanity - except in artistic inspiration (the
Muse), the voice of conscience (our better half) and schizophrenia, this right
lobe centre was, according to Jaynes, once active and
controlling of human behaviour. Speaking progressively up the social
hierarchy with the voice of one’s master, lord, king or god, the so-called ‘bicameral
brain’ held ancient humanity in thrall of social or collective consciousness. This is a partial explanation for the
incredible feats of engineering of the Beaker People (
This is certainly the conclusion of Erich Neumann in his exhaustive analytic psychology study of the evolution of consciousness - The Origins and History of Consciousness (1954). For Neumann, the ancient myths and religions show progressive development of the ‘hero’ as the carrier of individuality, i.e., of ego consciousness. Ego consciousness was an evolutionary struggle of one mythogemic complex among many for dominance. A mythogem is an analytic psychology term describing the common core of dreams, fairytales and myths of different peoples, in different places, in different times. They can, under different circumstances, also be called ‘archetypes’ or ‘complexes’, of which the ego complex is but one.
No matter the lateralization of brain function, the question remains how the various parts physically and functionally interact to produce what one calls consciousness? Recent work suggests that the decision-making or executive function located in the frontal lobes is always matched by an emotional response emanating from interaction of the cerebellum and brainstem (Freeman 1999). As to how a macroscopic state called consciousness results from the microscopic actions of brain cells or neurons, Freeman supports the concept of “circular causality”:
…Circular causality expresses the interrelations between levels in a hierarchy: a top-down macroscopic state simultaneously influences microscopic particles that bottom-up create and sustain the macroscopic state. The state exists over a span of inner time in the system that can be collapsed to a point in external time. Events in real time are marked by changes in the state of the system, which are discrete. (Freeman 2000)
From circular causality, I infer that a higher or ‘transcendent’ order of physical nature results from a specific relationship between parts that once attained (by chance, natural selection or otherwise) causes the resulting transcendent order to feed back on its parts to maintain that relationship. It involves not just a mutual reinforcing feedback (homeostasis) between a whole and its parts but also maintenance of the relationship between the parts themselves. In philosophical terms, circular causality creates a self-perpetuating epiphenomenon, i.e., a secondary phenomenon accompanying another and caused by it.
Examples in the NES include the quark field effect called hadrons, e.g., protons and neutrons. In the case of quarks, there are 6 flavours and three colours – charmed, up, down, strange, top and bottom, red, green and blue. These distinguish one quark from another. It is, however, their relationalism, i.e., quarks never exist alone but only in groups, that creates the epiphenomena called a proton (Nielson 2002). It is like sticking one’s hand into a jacuzzi with streams of water merging in the middle of the tub producing what feels solid but is an illusion, a secondary or epiphenomenon which, nonetheless, is ‘real’. While quarks cannot exist alone, they can transmute changing one field into another, for example, from a proton into a neutron, from hot to cold. In biology, the metabolism of living organisms is an example of circular causality. Another, this time also used by Freeman, is the laser (light amplification by the stimulated emission of radiation). The excited atoms in a laser cause coherent light emission, and the light imposes order on the atoms (Freeman 2000).
The transcendent resulting from circular causality of brain structure is ‘mind’ as distinct from brain. And the question of how the human mind ‘knows’ has been the focus of epistemological debate since pre-Socratic times in Western culture. This constitutes the software question of epistemology.
If mind is the result of circular causality of brain structure, then what is the nature and structure of mind itself? What are the mental components or faculties of knowing? How do they operate? Do they, in turn, through circular causality, generate yet another transcendent called society? The problem, of course, is that to study the mind one must use a mind.
For most of epistemological history, faculties of knowing (of whatever nature or constitution) were viewed as revolving around and at the service of an individual undivided conscious self. While in metaphysics, external entities like demons and angels might exist, it was nonetheless the individual atomistic soul that faced the world and was responsible for the consequences of its thoughts, words and deeds.
With Freud (1856-1939) this changed. Like a psychic Copernician Revolution, the ego of the conscious individual was shown to be but one planet revolving around a larger primary along with the unconscious, superego and id. The executive decisions of the ego could, therefore, be countermanded or frustrated by other players in a psychic drama leading to normality, neurosis or, at the extreme, psychosis.
It was, however, Freud’s protégé, colleague and eventual rival, Carl Gustav Jung (1875-1961), who moved beyond the self- and socially-imposed constraints under which his one-time patron worked. Jung literally constellated the human mind with a myriad of unconscious forms and structures that appeared to be the common inheritance of all humankind – the collective unconscious. They were archetypes of typical forms of thought and behaviour captured or crystallized out in the dreams, myths and fairy tales of all peoples throughout time – historic and prehistoric. Alternatively called analytic, complex, depth or Jungian psychology, this new psychology drew heavily on Kant (1724-1804) including concepts such as faculties of knowing and a transcendent function. In simplified form, there are four distinct features to the Jungian model (Jung 1953-1979):
a) Conscious/Unconscious (composed of distinct complexes or archetypes including the ego, all of which revolve around a transcendent called the Self);
b) Introvert/Extrovert/Centrovert (direction of attention)
c) Intellect, Intuition, Feeling & Sensation (ways of knowing in varying dominant/subordinate configurations); and,
d) Individuation (the teleological objective of realizing the Self).
For our purpose it is only (c), ways or faculties of knowing, that need concern us. Before doing so, however, it is important to recognize some possible political economic implications of circular causality and the Jungian unconscious. These may include such critically important but unplanned, i.e., arational or transcendent institutions such as the price system in the tradition of von Hayek in economics (Hayek 1937, 1945, 1989), and of power in the tradition of Bertrand de Jouvenel in political science (Jouvenel 1949, 1961).
A connection between Adam Smith and Carl Jung can be drawn through the work of Immanuel Kant (1724-1804). He was a contemporary of Smith with whom he shared a concept of faculties of knowing and, as we have seen above, Jung drew on Kant’s concepts of faculties and a transcendent function. To reconcile Jung’s four faculties – thinking, intuition, feeling and sensation – with an economic epistemology consonant with Smith I have chosen four terms that would have been familiar to Smith: Reason, Revelation, Sentiment and Sensation. For each I offer the analytic psychological definition and then contrast it with economic usage.
Before doing so, however, it is important to realize that it is not just the link between Smith, Kant and Jung that justifies a reconciliation of analytic psychology and economics. Unlike psychoanalysis derived from Freud, analytic psychology moved off the couch and into the field in the guise of one of the most widely used psychological testing instrument in the world: The Myers-Briggs Type Indicator®. It is used extensively in North American business and education to measure the mix of faculties possessed by an individual. The mix reveals how each individual learns best, i.e., accumulates knowledge and makes decisions. The implications for consumer and producer theory, in economics, are self-evident.
However, just as Thomas Kuhn was concerned with protecting normal science from being corrupted as ‘reason for gain’ (Kuhn 1996), James Hillman, a noted Jungian, is concerned about analytic psychology. In his 1980 monograph: Egalitarian Typologies versus The Perception of the Unique, Hillman notes that mass application of Jung’s typology of introversion/extraversion, etc., while not specifically naming The Myers-Briggs Type Indicator®, is alien to the fundamental methodology and principles of analytic psychology – the unique individual and the individuation process.
Reason (traditionally the primary faculty in economics) must be reconciled with the psychological concept of thinking. Thinking is defined as the mental process of interpreting what is perceived. It is one of four functions used for psychological orientation – thinking, intuition, feeling and sensation. In an individual, one tends to be dominant, two subordinate to the dominant function and one inferior, repressed or otherwise underdeveloped. Along with feeling, thinking is rational, i.e., thinking interprets or explains while feeling judges. If thinking is primary, then feeling is automatically the inferior function. Higher order thinking rigorously excludes feeling (and vice versa). Individuals whose thinking and feeling have equal motive power are undifferentiated with relatively undeveloped thinking and feeling functions. (Sharp 1991).
Philosophically, Reason has been considered the highest faculty of
knowing since ancient
In mainstream economics, Reason takes the radically materialistic form of Jeremy Bentham’s ‘calculus of human happiness’. Based on a hypothetical physical unit of pleasure/pain called a utile (hence Utilitarianism), this hedonic calculus was adapted during the Marginalist Revolution and displaced the labour theory of value. In summary, the ‘disutility’ of work is embodied in goods and services as usefulness, utility or satisfaction that consumers extract as pleasure (consumption as negative production) from goods and services purchased with income earned through the pain of work. The citizen is, at one and the same time, worker and consumer. Necessary assumptions include rationality, perfect knowledge and competence on the part of economic agents – consumers and producers. This method of calculating value was conceived before discovery of the ego, archetypes and the unconscious.
If circular causality is operative from the individual faculty to societal plane then one would expect to find in the economy an industrial sector specializing in the satisfaction of human wants, needs and desires through exploitation of Reason. If so, then a definable Science Industry would be expected.
Revelation or faith (the traditional antagonist of Reason) must be reconciled with the psychological concept of intuition. In psychology, intuition is the psychic function that perceives possibilities inherent in the present compared to sensation that perceives immediate reality. It is arational, i.e., it does not explain nor judge. It tends to be subordinate to a dominant function, usually thinking or feeling. Intuition gives outlook and insight into a garden of magical possibilities as if they were real (Sharp 1991).
In religion, Revelation refers to the disclosure of divine or sacred reality or purpose. It may come through mystical insights, historical events, or spiritual experiences that transform the lives of individuals, groups and entire civilizations. The revelations of a Moses, Buddha, Jesus or Mohammed can have incalculable social and economic effects ranging from changing patterns of consumption to international trade. More generally and at the individual level, it refers to the power or faculty of attaining to direct knowledge or cognition without evident rational thought and inference. In the realm of technological forecasting and assessment this has been called ‘no-knowledge’ (Jantsch 1967).
It is important to note that in Smith’s time, the Church still claimed, but could no longer enforce, a monopoly on Revelation. The 15th century artist/engineer/humanist/scientist began to claim godlike powers of creation, i.e., creating out of nothing - ex nihilo (Nahm 1947, 1950). Their importance, however, extends beyond their particular works. It marks the emergence of the individual out of feudal subordination. Most could claim only humble birth yet they achieved most noble ends – new knowledge, new creations. The ‘Cult of the Genius’ was born (Woodmansee 1984, 446, 47ff [Zilsel 1918]). The ground was in fact set for the Protestant Reformation’s assertion of direct contact between the individual soul and the godhead without intermediation by popes, bishops or clergy. Freeing the individual from subordination to birth (the Renaissance) and then from a monopoly on revelation by the clergy (the Reformation), the next step in the ascent of the individual was political: the Republic Revolutions and the declaration that “all men are created equal”.
Even in the NES dedication to Reason is sometimes blessed with Revelation or, as Thomas Kuhn describes it, “scales falling from the eyes”, “lightning flash” and “illumination” (Kuhn 1996, 123). Of scientific revolutions he writes:
[a] new paradigm, or a sufficient hint to permit later articulation, emerges all at once, sometimes in the middle of the night, in the mind of a man deeply immersed in crisis. What the nature of that final stage is - how an individual invents (or finds he has invented) a new way of giving order to data now all assembled - must here remain inscrutable and may be permanently so. (Kuhn 1996, 89-90).
If circular causality is operative from the individual faculty to
societal plane then one would expect to find in the economy an industrial
sector specializing in the satisfaction of human wants, needs and desires
through exploitation of Revelation.
Given that religion and a myriad of psychic movements and communities
(part of the Humanities & Social Sciences) claim dominance for Revelation,
then a definable Spiritual Industry would be expected including, for example,
the enormous ‘self-help’ movement in
The psychological term feeling also must be reconciled with economic usage. It is the psychological function that evaluates or judges what something or someone is worth compared with thinking that interprets what ‘is’. Both are rational functions. One or the other tends to be dominant in any individual – thinking type or feeling type. A feeling is as indisputable a reality as the existence of an idea (Sharp 1991). Feeling also leads to the cooperation or opposition between individuals and groups. Neurophysiology suggests feeling as a relational function originates in the mammalian or mid-brain.
Before the Marginalist Revolution, feeling or rather its economic equivalent - Sentiment - played a complimentary role with Reason in economics. It too, however, was displaced by Bentham’s hedonic calculus. For Bentham culture, custom and tradition (and related sentiments) were irrelevant to economic analysis because they were irrational and interfered with application of pure reason in the maximumization of Happiness, a neologism coined by Bentham himself (Bell 1976: 224). Yet this radical individualism flies in the face of demonstrable traditional and ideological attachments which shape an individual’s acts into collective action (Bell 1981: 70-72).
Furthermore, in the Benthamite tradition all men were not just created equal but also nondescript and malleable (Schumpeter 1949: 132-4). Therefore, taste and related sentiments were the same, or would become so through another Benthamite policy - compulsory education. Children would be raised in crèches to insure standardization. Questions of taste and style (and their related sentiments) were, therefore, irrelevant to economic investigation.
Even aesthetics were affected, shrinking to analysis of the pleasurable sensations evoked by a work of art. In this aesthetic, a thing is beautiful because it pleases, it does not please because it is objectively beautiful (Schumpeter 1949: 126-7). This aesthetic, combined with Benthamite emphasis on functional utility, meant that application of artistic effort to contribute beauty of form to function was rejected as “irrational”. In industrial design and architecture, this aesthetic reached its logical conclusion in the aphorism: form follows function.
In The Theory of Moral Sentiments
and The Wealth of Nations, Adam Smith,
however, stressed the role of Sentiment in the dialogue of market exchange,
e.g., trust (The Economist
The interaction of Reason and Sentiment in economic behaviour
is revealed in Grant McCracken’s 1988 study Culture
and Consumption. McCraken
begins by describing the birth of consumer culture. He argues that it was in 16th century
McCraken goes on to explore the subsequent English
consumer revolution of the 18th century with particular emphasis on the role of
Josiah Wedgewood in shifting the source of fashion
from the nobility to the bourgeois marketeer, or what
McCraken calls “market ethnographers” who watched for
patterns and regularities and adjusted products and marketing strategies to
take advantage of emerging opportunities.
By the 19th century such observers of society attained unprecedented
social mobility. Thus McCraken notes: “In the person of Beau Brummel
we see nothing less than the abrogation of powers of influence that had
previously been possessed only by the monarch”.
Today, of course,
If circular causality is operative from the individual faculty to the societal plane then one would expect to find in the economy an industrial sector specializing in the satisfaction of human wants, needs and desires through exploitation of Sentiment. Given that the Arts claim dominance for Sentiment, then a definable Arts Industry would be expected (Chartrand 2000).
Sensation is the psychological function that perceives immediate reality through the physical senses compared to intuition that perceives possibilities. Both tend to be subordinate to a dominant faculty and arational, i.e., they do not involve interpretation or judgement (Sharp 1991). Sensation is the most primitive of the faculties of knowing. It also presents the greatest epistemological problem because of its elemental nature. Everything we know about the external world comes through our senses. Two qualifications are required, however, before reconciliation of the psychological and economic meanings of this term can be conducted.
First, it is critical to distinguish between sensation and perception. This involves the difference between the raw data received by the senses (sensation) and its meaning as mediated by the higher faculties (perception). Even in the NES this remains a problem as evidenced by Kuhn’s analogy of ducks and rabbits to explain how two observers of the same objective reality see different things (Kuhn 1996, 111). It also plays a role in ‘experimenter expectation’, i.e., an observer is most likely to see what is expected.
Second, some biological senses are shunned in intellectual and emotional modes of Western thought. In aesthetics, for example, consideration is generally restricted to the ‘distant senses’ of sight and sound. The near senses of touch, taste and smell lead to obscenity, gluttony and scatology. Quoting Berleant:
Since the organs of sight and hearing are distance receptors, detachment from direct contact with the physical may be retained, for the other senses call attention to the body, so destroying the isolation of the contemplative mind. Thus the aristocratic attitude of classical Greek culture has been preserved: the conviction of the superiority of the essentially passive aloofness of the meditative spirit and contempt for the practical and manipulative. (Berleant Winter 1964, 187)
Aesthetics as a separate branch of philosophy appeared in the late 18th century with the German philosopher Baumgarten (Kristeller 1952, 34). It is important to note that “[t]he original meaning of the term aesthetics as coined by Baumgarten… is the theory of sensuous knowledge, as a counterpart to logic as a theory of intellectual knowledge.” (Kristeller 1952, 34) In effect, Baumgarten separated Art from subordination to religion and politics.
As observed above, part of the aesthetic problem lays in differentiating between the distant senses of sight and sound and the near senses of touch, taste and smell (Berleant Winter 1964). In this regard, a unique component of the NES – mechanical instrumentation – extends the human senses from the macro- to the micro-cosmic. In effect, it adds new ‘distant senses’ to the human repertoire. In a form of circular causality the resulting increase in knowledge about the physical world leads to new and improved instrumentation in what has become a seemingly endless cycle with significant technological implications for both producers and consumers in the modern economy. To the degree that aesthetics restricts itself to the distant senses, the effect of scientific instruments in extending or ‘distancing’ the human senses offers a link with what on the surface appear two distinct knowledge domains.
In economics, Bentham’s utile – a unit measure of pleasure/pain - is the foundation of knowledge and pleasure and pain are “the two sovereign masters of humanity” (Clough 1964: 825). One suffers the disutility of work (including entrepreneurship) to earn income to buy goods and services into which firms embody utility to be extracted by paying consumers through final consumption (pleasure). Economics, so defined, is strictly hedonic and materialistic. Sensation is, however, subordinated to Reason – in theory
In effect, Bentham presumed a technical device capable of measuring units of pleasure/pain without the intermediation of a human subject – like a scientific instrument. When this presumption could not be technically satisfied, pleasure and pain were reified (an abstraction made concrete) as money. Lack of money was the source of pain. Enough money was the source of pleasure. This led to equating value to society - of an object, product, process or person - with its dollar price in the marketplace. This assumption fostered development of an illusory calculus which became the centrepiece for the economic theory of consumer behaviour - the marginal utility theory of value. It also provided Marshall and Pigou with the foundation for contemporary welfare economics (Blaug 1968, 304).
In the Benthamite tradition, however, maximizing pleasure was restrained by the tenets of Ethical Hedonism, a very Protestant Ethic. This ethic, beyond concern with the moral value of work, also involved social inhibitions against conspicuous consumption (Veblen 1899). But, as noted by Daniel Bell (1976, 20-22), when the Protestant ethic collapsed after the Industrial Revolution, only hedonism was left - in all its unrestrained, irrational incarnations. Without a generally accepted moral code, the law became the accepted social institution to moderate individual pleasure-seeking. Benthamite traditions concerning crime and punishment in fact continue to guide both the law and economic research, e.g. Bentham’s famous and seemingly plausible dictum “the more deficient in certainty a punishment is, the severer it should be” (Becker 1968).
If circular causality is operative from the individual faculty to the societal plane then one would expect to find in the economy an industrial sector specializing in the satisfaction of human wants, needs and desires through exploitation of Sensation. Given that ‘sex, drugs and rock’n roll’ claim dominance for Sensation in Western culture, then a Pleasure Industry would be expected including the Sports and parts of the Food Industry.
In each individual, all four functions operate and through circular causality generate what is alternative called ‘self-awareness’, ‘consciousness’ or ‘knowing’ – a quintessence or the Fifth Substance. In this regard, the term homo sapien means literally ‘the wise earth’ or, alternatively, ‘earth wise’. In the Humanist tradition, only an individual human being can know and therefore only an individual human being can have knowledge.
Committees, corporations and nations do not know; there are no proven examples of artificial or extraterrestrial intelligence. Similarly, a training manual or a recording is just a material artifact until an individual decodes it. Only an individual human being can know and this is the basic premise of the labour theory of knowledge. Put another way:
The ultimate repositories of technological knowledge in any society are the men comprising it… In itself a firm possesses no knowledge. That which is available to it belongs to the men associated with it. Its production function is really built up in exactly the same way, and from the same basic ingredients, as society’s. (Graf 1957)
As we have seen, the labour theory of value maintained theoretical dominance from the time of Adam Smith to Karl Marx. In summary, the theory claimed the just price for a good or service was directly related to its labour input. Furthermore, the theory extended to define capital as embodying successive generations of labour leading to the current ‘state of the art’ by ‘round-about means of production’.
It was, however, rejected by mainstream or market economics in favour of a modified hedonic theory of exchange involving a stable equilibrium of constrained utility maximization by consumers and constrained profit maximization by firms. Rejection was based on, among other factors, the apparent empirical impossibility of quantifying the historical accretion of labour into capital (Dooley 2002). The proposed market solution, however, was heir to its own measurement problems centred on: How do you count utiles? Three compromises had to be made.
First, calculation was ordinal by level of preference (i.e., ranked 1st,
2nd, 3rd…) rather than cardinal (i.e., counted 5.3, 5.4, 5.5...). This innovation led to indifference curves
and geometric analysis of constrained maximization realizing the Euclidian
perfection demanded of ‘science’ by Descarte. Second, when Betham’s assumption of a technical means of
measuring utiles without intermediation by a human
subject then utiles were
money and dollar democracy was born. Third,
the definition of capital remained unresolved.
This was succinctly stated by T.K. Rymes of
Assuming circular causality, one would expect that faculties of knowledge
– Reason, Revelation, Sentiment and Sensation – to become socially institutionalized
as ‘knowledge domains’ of one form or another. This process I call ‘pragmatic
epistemology’. Nation states have in
fact created specialized funding agencies to foster and promote specific
Such grant-giving councils are economic agents that direct public monies towards the development of new knowledge – both for its own sake as well as for its contribution to the economy. The decision by such councils of what institutions, programs, projects or individuals to support is generally made through peer evaluation including officer grants made by practionners in the service of the councils (Chartrand 1987). This grant-giving system by peer evaluation parallels the independent practice of peer review of articles before publication in disciplinary journals. Using the Canadian experience, I identify three primary knowledge domains:
· The Natural & Engineering Sciences (NES);
· The Humanities & Social Sciences (HSS); and,
· The Arts.
Each rises up like a mountain above the lowlands and valleys of the traditional industrial economy. Each has its own historical and institutional foundations; each reaches up to a summit of excellence - individual and institutional. In the NES and HSS, the traditional institutional peak is the university. In the Arts, it is the fine arts academy, museum, music conservatory and production company. It is in these artistic, cultural and scientific ‘ivory-towers’ that most new knowledge is created, collected, compiled, conserved and/or coalesced into a nation’s stock of knowledge capital. From these icy peaks rivers and streams of knowledge flow down winding circuitous paths or through channels deeply chiseled into the historical bedrock of each nation-state. In the valleys and lowlands the waters merge, mingle and mix to irrigate all sectors of a nation's economy.
In practice such knowledge becomes applied as technology in the original Greek techne meaning art and logos meaning reason, that is, ‘reasoned art'’. The NES generate physical technology, that is, how to manipulate the natural world. The HSS generate organization technology, that is, how to manipulate the human-made world. The Arts generate aesthetic or design technology, that is, how to manipulate the human heart and soul to achieve what the Greeks called kosmos, the right ordering of the multiple parts of the world.
Beyond the pragmatics of identifying knowledge domains with current institutional structures, the proposed trio accords with a traditional epistemology. From as early as Galileo, a traditional distinction has been made between the primary, secondary and tertiary elements of knowledge, or experience. Primary knowledge concerns facts or quantities such as size and extension in space, number, weight or mass, motion and time. These elements of knowledge are regarded as belonging to the ‘real’ or physical world. They are accessible to observation, experiment and measurement. This is the domain of the NES.
Secondary knowledge, or qualities, pertains to sensations such as colour, taste, smell and form as well as larger concatenations of these qualities. Qualities are held to exist only in the mind of the observer, i.e. they are produced by the perceiving mind out of physical experience; they do not exist in the objective world. Accordingly, even if qualities are real, they are not directly accessible to the scientific method (Sloane 1991). This is the domain of the Arts.
Tertiary knowledge, or values, are not perceivable from the outside world
but are rather innate ideas, divinely implanted or invented by the subjective
In what follows, I will outline the relationship between faculties of knowledge and their relative status in each domain using a concept derived from computer science involving the status of ‘drives’, i.e., devices that store information. In a desktop computer there is a Primary Master/Slave and a Secondary Master/Slave configuration, i.e., there is a Primary and a Secondary configuration in each of which a hard drive serves as master to, e.g., a CD-ROM slave. This concept will be used to identify the unique relationship of faculties of knowledge in each domain. I will then outline its nature and a brief history.
Before do so, however, some background about the role of the university
is in order. The self-governing university, i.e. independent of Church and State,
emerged in the Occident during the twelfth and thirteenth centuries of the common era. At its
beginnings, the university was an incorporated association of teachers, as in
Before long, scholars and students grouped themselves into faculties, according to the different branches of knowledge. The original branches of knowledge, or faculties, were based on the seven Liberal Arts consisting of the trivium (the three part curriculum: grammar, logic, rhetoric) and the quadrivium (the four part curriculum: geometry, arithmetic, astronomy, music). The practices of medicine and law were later admitted. Their ‘vocational’ status, however, made them somewhat distant from the main academic body. Not admitted, excepting medicine, were the Mechanical Arts of weaving, blacksmithing, war, navigation, agriculture, hunting, medicine, and the ars theatrica. From that time to the present, the university has enjoyed unparalleled social and political autonomy. This autonomy is reflected in tenure, i.e. lifelong appointment, justified to permit scholars to pursue their intellectual interests free from the threat of dismissal for unpopular political or religious views.
In general, and allowing for the gradual movement of the Humanists into the university, this pattern of curricula held until after the Scientific Revolution of the 17th century. Then the University was, in effect, reshuffled into two primary knowledge domains – Moral & Natural Philosophy – together with the practices of law, medicine and music.
In the late 18th century, a reorganization of the German
university system resulted in the physical sciences being formally recognized as
a distinct knowledge domain and the so-called ‘research university’ was born. This institutional innovation spread quickly
The Social Sciences emerged out of Moral Philosophy beginning in the 19th and early 20th centuries. As this process matured, the Humanities coalesced as a distinct knowledge domain. Other than music, the Arts were not admitted until after the Second World War when faculties of fine arts including dance, drama and the visual arts were created. The university enjoys a near monopoly in the certification of, or degree granting to, students in all three knowledge domains.
The NES assigns dominance to Reason with Sensation and Revelation subordinate and Sentiment suppressed. The primary master is Reason and the primary slave is Sensation; the secondary master is Revelation, the secondary slave, Sentiment. It is the Primary Master/Slave relationship: Reason/Sensation that characterizes the NES - quantity.
There are three primary natural science disciplines – biology, chemistry and physics. Each breaks out into an increasing range of sub-disciplines and cross-disciplines, e.g., biochemistry. In each there are distinct engineering specialties, e.g., chemical, genetic, mechanical and, electrical engineering. Concerning the proliferation of specialized NES sub-disciplines, Thomas Kuhn concluded:
… [o]ver time a diagram of the evolution of scientific fields, specialties, and sub-specialties comes to look strikingly like a layman’s diagram for a biological evolutionary tree. Each of these fields has a distinct lexicon, though the differences are local, occuring only here and there. There is no lingua franca capable of expressing, in its entirety, the content of them all or even of any pair.” (Kuhn 1990, 7-8)
The peculiar relationship between Reason and Sensation in the NES represents a fundamental change from the ancient and medieval worlds. As we have seen, from ancient times there has been a schism between those who worked with their heads and those who worked with their hands. A first span across this gulf was laid in the Renaissance; an additional one was laid in the 16th and 17th centuries when the ‘experimental method’ of the high artisans and instrument makers seduced schoolmen and Humanists. This marriage of head and hand inaugurated modern ‘instrumental’ science (Zilsel 1940, 1941, 1945; Houghton 1941; Newman 1989). The spirit of playful fascination with new instruments and devices at this time is cleverly captured in Umberto Eco’s 1994 novel: The Island of the Day Before (Eco 1994).
This marriage of head and hand is known as the ‘Zilsel
Hypothesis’ in the history of science (Zilsel 1945). Two other hypotheses explain why it was in
It was Robert Boyle during the 1650s who placed the laws of the physical universe in stasis above and beyond the meddling of human and God (Jacob 1978). The act of Creation had, once and forever, established the Laws of Nature. Having set the machine in motion God withdrew and Nature became the legitimate object of the increasingly complex and disinterested machines of experimental natural philosophy. This separation of Nature from religion was, as will be seen below, preceded by the separation of politics from religion initiated by the Humanists in the 16th century, especially by Machiavelli (1469-1527).
It is interesting to note that Boyle’s personal physician, William Petty, wrote extensively about the labour theory of value. “For Petty, land and labour were the original source of all commodities: “Labour is the Father and active principle of Wealth, as Lands are the Mother” (Dooley 2002, 2).
Openness and exchange between head and hand, however, began to close almost immediately due to, among other things, the ‘Houghton Hypothesis’, i.e., the aristocratic influence of Cavalier ‘Virtuosi’ including one of the founders of the Royal Society, John Evelyn (Houghton 1942). By the Victorian Age the two worlds were sealed off again into their ancestral solitudes (Houghton 1952). It was at this time that vocational training in the English-speaking world became formalized in institutions of higher education called polytechnics created by the founders of the Industrial Revolution who, for religious reasons, could not attend the universities of the day.
The men responsible for technological innovations . . . during the beginning of the Industrial Revolution were nonconformists who had been excluded from the universities and learned their science indirectly while pursuing their trade. In other words, the coupling between science and technology was very loose and did not rely on the established system of higher education. (Senate Special Committee 1970: 21)
The success of vocational institutions like the Manchester Polytechnic
resulted, in many cases, in their absorption or transformation into
universities. For example, the
Manchester Polytechnic became the
In the NES, Sensation is in the service of Reason. As with be seen below, this contrasts with the Arts in which Sensation is master and Sentiment slave. The contrast can be characterized as extroversion and introversion. In the case of the NES, Sensation is directed outward by Reason towards the external world. In the Arts, Sensation directs Sentiment inwards towards what James Hillman calls The Thoughts of the Heart (Hillman 1981).
The HSS assigns dominance to Sentiment with Reason and Revelation subordinate and Sensation suppressed. The primary master is Sentiment, the primary slave Reason; the secondary master is Revelation, the secondary slave Sensation. It is the Primary Master/Slave relationship: Sentiment/Reason that characterizes the HSS - values.
The Humanities or rather Humanists first appeared in
Nonetheless the Humanists began serious investigations, some of which eventually entered the university, e.g., philology or ‘comparative linguistics’ that may be called the first ‘social’ science. While some Humanists attended university, originally they were not part of the university. Their natural environment was secular, not scholastic or religious. In effect, Humanist separated secular human life, especially politics, from religion, e.g., Machiavelli.
Humanism, based on the premise that Man, not God, was
the measure of all things, declined for three reasons. First, it was identified with the Republic
and when the political fortunes of
The modern social sciences began within Moral Philosophy where they continued until the 19th century. As noted by Kenneth Boulding:
Adam Smith, who has strong claim to being both the
Adam and the Smith of systematic economics, was a professor of moral philosophy
and it was at that forge that economics was made. Even when I was a student, economics was
still part of the moral sciences tripos at
Through the course of the 19th century the success of the NES led many moral philosophers to adopt, as best they could, the methods of the apparently more successful natural philosophers who were renamed ‘scientists’ in 1833 by William Whewell (Snyder 2000). There were, however, two contrary tendencies. The first was towards a unified single, social science, e.g., the sociology of Comte. The second was towards specialization. In the end, the second triumphed. Today the Social Sciences breakout into a very wide range of disciplines and sub-disciplines funded by the Social Sciences & Humanities Research Council of Canada including: administrative studies, archaeology, communications & journalism, criminology, demographics, economics, education, geography, industrial relations, information science, law, library science, political science, psycholinguistics, psychology, recreology & physical education, science policy, social work, sociology and urban & regional studies (Chartrand 1980).
The Humanities and the Social Sciences share a common concern with human values. Whether it is formal ethics or the costs of monopoly power, both sub-domains use Reason in the service of Sentiment. And in both, the pursuit of fame has given way, as the primary Sentiment, to the contribution to knowledge.
The Arts assigns dominance to Sensation with Sentiment and Revelation subordinate and Reason suppressed. The primary master is Sensation, the primary slave Sentiment; the secondary master is Revelation, the secondary slave Reason. It is the Primary Master/Slave relationship: Sensation/Sentiment that characterizes the Arts - qualities.
The primacy assigned to Sensation by the Arts has troubled society from the very beginnings of western civilization. As Plato warned:
… we must remain firm in our conviction that hymns to the gods and praise of famous men are the only poetry which ought to be admitted into our State. For if you go beyond this and allow the honeyed muse to enter, either in epic or lyric verse, not law and the reason of mankind, which by common consent have ever been deemed best, but pleasure and pain will be the rulers in our State (Plato, Book X, 1952: 433-434).
It is ironic that it was not Art but Economics, specifically Bentham’s hedonic calculus, that in the late 19th century made pleasure and pain “the rulers of our State”. Fear of Art was reinforced, not diminished, with the rise of Christianity. As one of the three great world religions subscribing to the Ten Commandments (Judaism and Islam being the other two), Christianity explicitly prohibits worship of ‘graven images’. Among all three ‘peoples of the book’, censorship of the image traces back to Moses and the Golden Calf. In the book (the meaning of the word - Bible), the Word is sacred but the image, at best, is profane and at worst is evil incarnate.
This metaphysic suppression was reinforced by the fact that what today we call the Arts were Mechanical, not Liberal. Other than ‘hymns to the gods and praise of famous men” the Arts were tasked by Aristotle with the imitation of Nature. By this criterion, until the Renaissance artist/engineer/humanist/scientist and their development of perspective, it was obvious that human-made Art was inherently inferior to Nature. Once the imitator successfully approximated the original (in appearance) the Arts, specifically the visual arts, attained a significantly higher social status and the visual artists attained celebrity. The godlike power of creating out of nothing began to be attributed to the visual artist initiating the Western cult of the genius.
Imitation continued to be the test until the late 18th century when the Fine or Beaux Arts coalesced and were rationalized through the new philosophy of aesthetics created by Baumgarten - his new science of sensual knowledge to balance logic as the science of intellectual knowledge (Kristeller 1952, 35). The word aesthetics itself derives from the Greek aisthesis - the activity of perception or sensation - which at root means “taking in” and “breathing in” - a “gasp”, the primary aesthetic response (Hillman 1981).
The successful imitation of Nature by the Arts combined with the success of the NES in revealing her secrets led to what is known as “Querelle des Anciens et des Modernes” or the battle of the Ancients and the Moderns. This marked the beginning of the 18th century Enlightenment and the end of the Renaissance (Kristeller 1952, 19). Who are superior, the Ancients or the Moderns? The answer - the Moderns.
The primary but reversed position of Sensation - slave - in the NES and – master - in the Arts serves to highlight four differences between these two knowledge domains. First is the use of concepts and precepts. In effect, Science knows while Art does:
Whereas Art begins with desired effects and finds causes to create these effects and no others, Science starts with presumed causes and seeks effects to confirm or negate these causes. Art organizes ignorance by precepts while Science organizes knowledge by concepts (Nevitt 1978, 7).
A second difference is that new knowledge in the Arts does not necessarily displace the old. Rather King Tut still sells; Shakespeare is still performed; Bach is played more today than in the 17th century. At the same time, Egalitarian Realism or poke-in-the-eye art as well as Mapplethorpe’s homo erotica photography and Andres Serrano’s ‘Piss Christ’ find an audience in spite of the Culture Wars of the 1980s and 1990s (Chartrand 1991). These correspond to the so-called ‘Science Wars’ during the same period (Fuller 2001).
Third, subject to Reason in the NES, Sensation is restricted to ‘what is’. In the Arts, Sensation is master and an avant garde has existed since the mid-19th century that seeks change for change sake; it seeks novelty (Scitovsky 1976). The Arts embody the impulse toward the new and original, a self-conscious search for future forms and sensations to the point that the idea of change and novelty overshadows the dimensions of actual change. The artist no longer, as in the past, affirms a moral-philosophic tradition but rather searches for a new sensibility, a search which society actively encourages. What is imagined in the mind of the artist today becomes the reality of tomorrow (Bell 1976: 33-35).
Fourth, the role of Reason as master in the NES made entry into the University relatively easy. In the case of the Arts, however, with the exception of music (due to its Pythagorean connection with mathematics) and literature (rhetoric and grammar), the Arts were not part of the ancient or medieval liberal arts curriculum (Cantor 1969: 66-67). The Arts were and still are considered ‘crafts’, i.e., they involve experiential learning. It was not until the Renaissance that the fine art academy was established as a formal center for visual art education. And this was done completely independent of the university (vom Busch 1985, 3). In theater and dance, there was no formal training in any English-speaking universities until the late 19th and early 20th centuries (Robinson 1982, 178-179, 191-192). The traditional independent status of the music conservatory within the University is further evidence of the separate institutional pattern of learning pursued in the Arts.
Today the Arts consist of four primary disciplines and their component sub-disciplines including: the literary, media, performing and visual arts. Each in turn operates in five distinct functional areas including: the amateur, applied, entertainment, fine and heritage arts (Chartrand 2000).
Knowledge flowing from the three domains (whether from the profit, nonprofit or public sectors) is abstract and intangible. It is not like a car or a house which can be locked and secured against theft. In economic terms, knowledge is non-excludable. Furthermore, if someone gains knowledge it does not reduce that available to others. In economic terms, knowledge is non-rivalrous. These characteristics run counter to the usual legal concept of property rights:
In the technical language of jural relationships, Western law tends to ascribe to the possessor of the thing: (1) the right to possess the thing with a duty in everyone else to stay off, (2) the privilege of using the thing with no right in anyone else to prevent that use (coupled with a right in the possessor to prevent others from using the thing), (3) a power to transfer any or all the possessor’s rights, privileges, powers, and immunities to anyone else (who would in the technical language be described as liable to the exercise of the power), and (4) an immunity from change by anyone of those same rights, privileges, and powers (so that everyone else is disabled from changing them). (Donahue 2003)
If: (i) others cannot be excluded from access except by secrecy; and, (ii) use by others does not reduce the amount available to an owner; then how can knowledge be converted into economic property that can be bought and sold in markets?
Formal intellectual property rights (IPRs) such as copyrights, patents, registered industrial designs and trademarks, are created by the State as a protection of, and incentive to, creativity which otherwise could be used freely by others. In economic terms, without such legislated rights, knowledge suffers the free-rider problem. In return, the State expects creators to make their work available and that a market will be created in which such work can be bought and sold. But while the State wishes to encourage creativity, it does not want to foster harmful market power. Accordingly, it builds in limitations to the rights granted to the creator. Such limitations embrace both time and space. Rights are granted:
· for a fixed period of time, i.e., either for a specific number of years or for the life of the creator plus a fixed number of years; and,
· only for the fixation of creativity in material form, i.e., it is not ideas but rather their expression in material form (a matrix) that receives protection.
Eventually all intellectual property (all knowledge) enters the public domain where it may be used by anyone - without charge or limitation. This public domain or ‘knowledge commons’ exhibits characteristics different to those of the physical commons, e.g., depletion of fish stocks. By nature and by law, the public domain for knowledge tends to grow and increase. In fact, IPRs are primarily justified as a way of increasing the public domain. Even during the period in which rights are in force, there are exceptions such as ‘fair use’ or ‘fair dealing’ with respect to copyright. In the case of patents, national statutes and international conventions generally permit ‘research’ using the patented product or process by profit, nonprofit and public agents. Governments also retain the authority to waive all patent rights in “situations of national emergency or other circumstances of extreme urgency…” (WTO/TRIPS 1994, Article 31b).
The evolution of IPRs has not been, however, as neat and simple as the above description may imply. Furthermore, enforcement is, relative to physical or tangible property, especially problematic.
Two years before publication of the Wealth
of Nations perhaps the most momentous decision in the modern history of
knowledge was reached in 1774 by the Law Lords of England in the case of Donaldson
v. Beckett: does an author have a natural and perpetual copyright? – No! (Chartrand 2000) This decision, however, did not reach the
rebelling colonies in
The transition from concepts of physical things to concepts of business assets, [that] could not be fully completed until the idea of ownership was shifted from the holding of physical things to the expectations of profit from the transactions of business. (Commons 1925, 275)
In the same year, 1774, across the
The Physiocratic theory of economic policy is fundamentally related to a theory of property: state relations in which private property is the dominant institutional form but wherein the public interest is manifest in the continuing modification or reconstitution of the bundle of rights that comprise private property at any given time. (Samuels 1962, 161)
Thus the Physiocrats intended to ‘load the dice’ of the marketplace in order to raise the ‘commanding heights’ of the economy and build up its strategic sectors, in their case, agriculture. They intended the conscious manipulation of capitalist self-interest – accumulation of marketable property - to foster and promote the economic growth and development of France - their Royaume Agricole.
Finally, the Physiocrats did not only view property rights as instruments of economic policy, they viewed the entire foundation of the economy – what is bought and sold, how and where – as legal in nature and subject to public policy control and manipulation to further the public good:
Thus did the Physiocrats implicitly recognize that the basic economic institutions (the organization of economy) are legal in character; that law is an instrument for the attainment of economic objectives and that economy is an object of legal control. (Samuels 1962, 162)
The shift in the nature of business assets from tangible property to the expectation of making a profit combined with the manipulation of property rights as economic policy finds its most developed expression in intellectual property rights, i.e., the right to buy and sell knowledge. This includes patents and trade secrets:
The similar principle has been worked out in the law of patents and trade secrets. A secret process or invention, not yet given to the public nor patented, remains by operation of common law, the exclusive property of the inventor, and his secret cannot be wrested from him by fraud or communicated to or used by others through breach of confidence. Yet “whenever the inventor permits the invention to pass beyond the legally defined limits of his exclusive possession, his right to it ceases and the right of all mankind to it begins.”
In other words, the old distinction between the possession of physical property and liberty of contract becomes the distinction between the behavior of those persons who are subject to command and obedience and the behavior of those persons who are subject only to persuasion or coercion. “Economy” is the exclusive holding for one’s own use, according to one’s own will, but the thing now held for one’s own use is not a physical thing, the manuscript, nor even the printed book, nor the physical objects embodying an invention, but is the behavior of persons over whom the owner retains the power of command and obedience, since they are his employees, agents, friends, who are bound to obey his commands in their use of the manuscript, book, or secret process. (Commons 1924, pp. 281-2)
In essence, the above applies in
The French Revolution was very different.
Essentially everything was swept away especially the law. Before the Revolution, Roman law governed in
the south of
The rationalizing tendencies of the French Revolution went much further than that of the American:
After the Revolution, codification became not only possible but almost necessary. Powerful control groups such as the manors and the guilds had been destroyed; the secular power of the church had been suppressed; and the provinces had been transformed into subdivisions of the new national state. The Napoleonic Code, therefore, was founded on the premise that, for the first time in history, a purely rational law should be created, free from all past prejudices and deriving its content from “sublimated common sense”; its moral justification was to be found not in ancient custom or monarchical paternalism but in its conformity to the dictates of reason. (Encyclopedia Britannica 2003)
The result was the Napoleonic or Civil Code that came into force in
1804. It remains, in one form or
another, the dominant legal system in the non-English-speaking world including
Some commentators have suggested that, for practical purposes, a convergence is occurring between the two systems:
One of the striking results of this survey of property law in the West has been to recognize the extent to which the differences between the civil-law systems and the Anglo-American systems are not of great practical significance. Despite substantial differences in the history of the two systems - differences that are still manifest today in the different vocabulary and different devices that the two systems use to solve legal problems - it was frequently possible to say either that the two systems arrive at the same practical result or that the practical results in the two systems are converging. (Donahue 2003)
One significant difference between the two, however, is the rights of legal and natural persons. A nature person is a living human being; a legal person is a body corporate. The vast bulk of productive assets in First World countries are owned by fictitious legal persons such as corporations, companies, sociétés, Gesellschaften that are created under general incorporation statutes that allow such a ‘person’ to engage in a wide variety of profit making and charitable activities. In the most general terms, under the Anglo-American tradition legal and nature persons enjoy the same rights; under the Civil Code they enjoy different rights. It is with respect to knowledge - especially copyright in the Anglo-American tradition and author’s rights in the Civil Code tradition - that this difference is sharpest.
On the one hand, and in keeping with the ‘Cult of the Genius’ (Woodmansee 1986), both share the sentiment that:
… intellectual property is, after all, the only absolute possession in the world... The man who brings out of nothingness some child of his thought has rights therein which cannot belong to any other sort of property… (Chaffe 1945).
This focus on the individual as creator is even reflected Article I, Section 8 of the U.S. Constitution, known as the “Intellectual Property or Copyright Clause”, that states:
The Congress shall have Power . . . To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries;
On the other hand, under the Anglo-American tradition, all rights flowing from the creator’s work, i.e., from “the only absolute possession in the world”, are subject to contract and can be extinguished in the natural person and fully transferred to a legal person, i.e., a corporation. Under the Civil Code, however, a natural person, as creator, enjoys certain rights that are “inalienable, unattachable, impresciptible and unrenounceable” (Andean Community 1993). Such imprescriptable rights relate to the ‘personality’ that a natural person possesses but a legal person does not. In effect the American Revolution was not completed. Its eloquence in defense of the individual – all men are created equal – remains compromised by extending the rights of natural persons to bodies corporate that are, in Common Law, the very guilds and corporations of which Adam Smith was so concerned.
In the case of copyright, the Common Law adopted, with a shortening of duration and recognizing the author as the source, the customary bargains and business practices of the pre-existing printer’s copyright (Chartrand 2000). Put another way:
... The European edifice of author’s rights rests on two pillars: the author’s economic rights and moral rights. Economic rights allow the author to assign or license to others the right to use the work... and are the principle means by which an author reaps profit from the work. Moral rights grant the author continuing control over the work despite its exploitation... In this scheme of things, the author is front and centre stage; later exploiters and users of the work are secondary players and stand in the wings.
Anglo-American law takes a more pragmatic approach to copyright. Copyright is essentially a vehicle to propel works into the market: it is more an instrument of commerce than of culture. It is geared more to the media entrepreneur than the author. It is ready to grant copyrights not just to authors but to secondary users who add value to the work: record companies, broadcasters, movie studios, and even printers... Unfair competition rather than authors’ rights seems to be the guiding force behind copyright. Whether rights should be extended to a work is more a question of political pragmatism depending on the strength of a particular interest group ... In such a scheme, economic rights are emphasized: moral rights are unheard of, save insofar as particular complaints can be slotted into some common law theory or statute designed to prevent unfair competition. Unless an author has retained some moral rights by contract, the assignment or licensing of the work pro tanto terminates his or her involvement with it (Vaver 1987: 82-83).
The clash between Civil Code author’s rights and
Anglo-American copyright fuel an ongoing controversy between the
Intellectual property rights do not protect ideas but rather their expression fixed in a tangible material form called a ‘matrix’. A matrix is a material in which something is enclosed or embedded. A tangible material form is something that, traditionally, could be seen, touched or otherwise perceived by a human being and, furthermore, it had to have some permanence. One last requirement is that any expression so fixed in a matrix be original. Four questions arise. First, why are ideas not protected? Second, what constitutes a matrix? Third, what constitutes perception of a matrix? Fourth, what is the function of a matrix relative to the knowledge embedded therein?
Justice Yates in his dissenting opinion in the 1769 case of Millar v. Taylor laid out the argument of why ideas can not be protected. This argument was, in effect, accepted in the crucial 1774 decision in the case of Donaldson v. Beckett (see above, Evolution):
Mr. Justice Yates had very clear and definite notions as to the limits of property, but a reference which he makes to the civil law throws a stronger light on his view of the whole subject than any of his direct reasoning. What the Institutes have to say relating to “wild animals,” he observes, “is very applicable to this case.” And he then proceeds to draw a comparison between these two singularly related subjects. Animals ferae naturae are yours “while they continue in your possession, but no longer. “ So those wild and volatile objects which we call ideas are yours as long as they are properly kenneled in the mind. Once unchain or publish them, and they “become incapable of being any longer a subject of property; all mankind are equally entitled to read them; and every reader becomes as fully possessed of all the ideas as the author himself ever was.” (Sedgwick 1879)
Ideas are therefore not the object of intellectual property rights because they are like wild animals that once free belong to no one and everyone at the same time, i.e., they are in the public domain. It is only their specific expression fixed in material form – commonly known as a work – that qualifies for protection.
What constitutes a matrix has proven problematic. Examples drawn from the recent history of
Examples concerning patents in the
In the case of genetic patents, the U.S. Patent Office denied patenting
of living material including genes until 1980.
At that time the Supreme Court in the
Diamond v Chakrabarty
case reinterpreted the existing
law, i.e., there was no change in the law itself. The case involved a patent for a genetically
engineered microorganism that breaks down crude oil. The Court observed that Congress had the power
to limits such patents but by failing to legislate specifically about genetic
patents it had, in effect, allowed gene patenting. This landmark case set the stage for patenting,
at least in the U.S., of more complex life forms such as the Harvard mouse (a
patent for which was recently rejected by the Supreme Court of Canada). The
In the case of software patents, the Patent Office resisted patentability because computer programs were considered mathematical algorithms, not processes or machines. The Patent Office changed its policy in 1981 due to the case of Diamond v. Diehr in which the Supreme Court ordered the Office to grant a patent to an invention even though computer software was involved. The Court found the program was not just a mathematical algorithm but rather a process, specifically for molding rubber. The Patent Office continued to be troubled about distinguishing a computer program from an algorithm. In the 1990s the Federal Circuit Court tried to clarify the question by requiring that an invention be examined as a whole and finding that an invention using a computer to manipulate numbers representing concrete or real world phenomenon is a process relating to tangible material forms and is patentable. In 1996 the Patent Office adopted its Final Computer Related Examination Guidelines making a computer related invention patentable if the program is used in connection with a specific machine or product. (Beck & Tysver 2000).
As demonstrated above, a matrix originally needed to be perceptible by a human being, particularly by sight. The law, being inherently conservative, traditionally concluded that if the matrix was not perceptible then it was not possible to assess the other requirements for protection, e.g., originality, non-obviousness, usefulness, etc. In the case of ephemeral displays on a television or computer screen prior to 1987 in Canada, an electron might be a part of the physical world but if a lawyer could not see, touch or otherwise perceive it then it had no legal standing as a matrix (Keyes & Brunet 1977, 129).
Over time, but especially in the last quarter century, the role of instrumentation in extending the human senses has been accepted. The implication is that there is no longer any microscopic (or macroscopic) legal limit to intellectual property being fixed in material form, only a technical one.
Relative to the knowledge embedded within it, the question arises as to what is the function of a matrix? Essentially a matrix can have one of three functions – utilitarian, non-utilitarian and personal. These can be used to order intellectual property rights into corresponding generic categories.
In the case of designs and patents, the matrix is utilitarian. Thus an industrial design impresses aesthetic value onto a matrix that is useful in its own right – a decorated coffee cup remains a coffee cup. A patent, on the other hand, impresses utilitarian function or ‘usefulness’ into matter itself – an electromagnetic door jam is a new type of door jam. To repeat the definition used by the U.S. Supreme Court in Diamond v Chakrabarty (above), manufacture means: “the production of articles for use from raw materials prepared by giving to these materials new forms, qualities, properties, or combinations whether by hand labor or by machinery.”
In the case of copyright and trademarks, the matrix is non-utilitarian. Thus a copyright protects expression fixed in a matrix that has no inherent utilitarian value, e.g., a book makes a second rate door jam. Similarly, trademarks (and marks or origin) embody the ‘identity’ of a company, business, district or government. Like copyright the matrix on which a trademark is embedded or fixed has no intrinsic value. Unlike copyright, however, a trademark impresses ‘good will’ earned by a business or government department or agency from citizens, clients, customers and/or the general public.
In the case of ‘know-how’ and trade secrets (the least well defined forms of intellectual property rights), the matrix is personal, i.e., knowledge is fixed in either a natural or a legal person. Know-how is essentially experiential in nature. In this sense it is like the Arts. Only a human being can have experience and hence know-how is fixed in a natural person. As will be demonstrated (below, Tacit Knowledge), such experience can, through a master/apprentice relationship, be transferred from one person to another by demonstration and practice but it cannot usually be formally articulated (see below: Codified Knowledge).
In the case of trade secrets, knowledge may be fixed in either a natural or a legal person. A trade secret, using the metaphor of Justice Yates (above), is a caged animal - ferae naturae. The cage is the contractual confidentiality provisions used by legal persons to bind employees and other agents to secrecy. It should be noted that not every country has formalized know-how and trade secrets as intellectual property rights through statute. However, some more recent international conventions do formally recognize and protect trade secrets and know-how, e.g., the Common Industrial Property Regime of the Andean Community and the WTO Agreement on Trade-Related Intellectual Property and Services (TRIPS) (Chartrand 2001).
The commercial nature of industrial designs, patents and trademarks also place them in a distinct legal category called ‘industrial property’, the subject of the first international intellectual property rights convention, the Paris Convention for the Protection of Industrial Property of 1883 (Chartrand 2001). The non-utilitarian nature of copyright, by contrast, is recognized in a separate set of international conventions beginning with the Berne Convention for the Protection of Literary and Artistic Works of 1886 (Chartrand 1998). The difference was summed up by Keyes and Brunet in the following manner:
Though copyright is expressed in terms of property, it is not directly analogous to industrial property (patents, trademarks and industrial designs, where the major concern is with the circulation of goods that have economic value apart from their intellectual content. As it deals with purely intellectual matter, copyright can never interfere with a person’s physical well-being. (Keyes & Brunet 1977, 3)
While the nature of the matrix can be used to order intellectual property rights into corresponding generic categories – utilitarian, non-utilitarian and personal - the specific nature, scope and composition of each type of IPR establishes a distinct legal foundation for industrial organization in a national knowledge-based economy. Furthermore, each type of IPR consists of a distinct and differing bundle of rights defining what forms of knowledge can be bought and sold, where it may be marketed, under what terms and conditions and for what time period such rights are enforceable before new knowledge enters the public domain. In effect, IPRs establish the ‘rules of the game’ for the commercial exploitation of knowledge.
The law, however, is a cultural artifact, i.e., it varies in principle
and practice between countries and cultures.
IPRs therefore vary significantly between, and
even within, neighborhoods of the global village. Thus among
All contemporary Nation-States are, in fact, actively engaged in the reform and revision of their respective IPR regimes responding to, among other things, rapid scientific and technological advance. Each strives, formally or informally, to develop an optimal legal environment for the successful generation of new knowledge and its subsequent commercial exploitation - subject to the constraints implicit in its cultural history and tradition. This evolving legal structure is, in turn, part of a broader movement towards national innovation systems (OECD 1997).
In what follows I will summarize the nature and history of the six
principal forms of IPRs – designs & patents,
copyrights & trademarks, and know-how & trade secrets – within the Anglo-American
tradition with only passing references to Civil Code practices and
provisions. One class of IPRs will not be discussed, so-called sui generis or one-of-a-kind rights tailored
for specific products. These include
plant breeder rights (plant and animal) and integrated circuit topology
In the Anglo-American tradition, evolution of IPRs reflects not just the impact of scientific and technological advance but also politics and case law. Adam Smith’s concern about the entwining of politics and economics - converting political power into profit and profit into political power – is evident in the case of IPRs. Copyright is a case in point:
The most compelling advantage of encouraging copyright industries to work out the details of the copyright law among themselves, before passing the finished product on to a compliant Congress for enactment, has been that it produced copyright laws that the relevant players could live with, because they wrote them. If we intend the law to apply to individual end users’ everyday interaction with copyrighted material, however, we will need to take a different approach. Direct negotiation among industry representatives and a few hundred million end-users would be unwieldy (even by copyright legislation standards). Imposing the choices of the current stakeholders on a few hundred million individuals is unlikely to result in rules that the new majority of relevant players find workable. They will not, after all, have written them. There are, moreover, few signs that the entities proposing statutory revision have taken the public’s interests very seriously. Instead, they seem determined to see their proposals enacted before they can be the subject of serious public debate (Litman 1996).
Reliance on industry to direct change and development of IPRs, combined with case law defining and extending such rights, continues the practice identified by J.R. Commons: “…they … have courts of law willing and able to convert their customary bargains into a common law of property and liberty... [t]he monopoly, the closed shop, and the private jurisdiction were gone … the economics and ethics remained” (Commons 1924, 230).
Designs and patents both use a utilitarian matrix to embed knowledge in a tangible material form. Industrial design involves the arrangement of elements or details that contribute a distinctive aesthetic appearance rather than a function to a good or service. In this sense there is a relationship between copyright protecting a work of art and industrial design. Both involve aesthetics but in the case of a copyright the aesthetic element is fixed in a matrix that has no utilitarian value. By contrast the aesthetic element of industrial design is fixed in a utilitarian matrix, e.g., a coffee cup without a design retains its function. In addition, am original work of art tends to be unique while an industrial design is usually produced in large numbers. Industrial design protection can be obtained by both natural and legal persons. Industrial design emerges from the Arts.
Design protection is granted for a fixed time period (for, example, 14
years in the
The first design-related legislation in
Patents are granted for new and useful compositions of matter (e.g., chemical compounds, foods, and medicinal products), machines, manufactured products and industrial processes as well as to improvements to existing ones. In some jurisdictions, patents can also be granted to new plant and new animal forms developed through genetic engineering. Patents, unlike industrial design, emerge from the NES rather than the Arts.
Through case law and amendment,
A description of the invention must be
deposited, in writing and drawings, sufficiently detailed to allow one of
ordinary skill in the art to replicate the invention. This insures that new knowledge enters the
public domain while the rights of the inventor are protected. In the case of microorganisms, description
can take the form of a deposit of a sample with an authorized depository. Patent protection is for a fixed period of
time (in the
The term ‘patent’ entered the English language in the 14th century. Patents for invention were originally just
one form of monopoly granted by the British Crown. Such grants were signified by Letters Patent,
open letters marked with the King's Great Seal. The earliest known English patent for
invention was granted by Henry VI to Flemish-born John of Utynam
in 1449. The patent was a 20-year
monopoly for a method of making stained glass that had not been previously
By the time of James I, abuse of the monopoly system in general had
become so great that the Statute of
Monopolies was enacted in 1624. It
made all monopolies illegal except for “any manner of new manufactures within
this Realm to the true and first inventor”.
Furthermore, such monopolies could not be “contrary to the law nor
mischievous to the State by raising prices of commodities at home or hurt of
trade”. For some 200 years the patent
Congress shall have power ... to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.
Copyrights and trademarks both use a non-utilitarian matrix to embed knowledge in a tangible material form. Copyrights are rights traditionally granted to creators of artistic and literary works. These rights have, however, been extended over time to include:
· artistic works such as choreography; drawings, motion pictures, musical compositions, paintings, photographs, sculptures and works of architecture;
· literary works such as novels, poems, plays and reference works, and,
· commercial or utilitarian works such as advertisements, computer programs, databases, maps and newspapers.
Copyright are granted to natural and legal persons. When granted to a natural person they endure
for the life of the artist/creator plus a fixed number of years that varies
between countries, e.g., in
The word ‘copyright’ entered the English language in 1735. With the William Caxton’s
introduction of the printing press (the first engine of mass production) in
In 1557, Queen Mary granted a charter to what became the Company of Stationers of London. Stationers’ Copyright was based on royal prerogative or letters patent covering the entire publishing industry as an estate. This monopoly was assigned to members as a freehold interest. No consideration was given to the author's right.
The Stationers’ Company was the only ‘guild’ monopoly to escape dissolution under the Statute of Monopolies in 1624. The reason was political utility:
[Queen] Mary incorporated the Stationers' Company “to set up a mode of regulating the English printing trade that would facilitate the efforts of the Romish clergy to stamp out the Protestant Reformation.” But the motives of the stationers “were of a less exalted kind.” Thus, Elizabeth, relying on the stationers’ self-interest, confirmed the Charter to turn the stationers to support the English, rather than the Romish church, and the Stationers’ Company became, in turn, the instrument of the Stuarts against the Puritans, in the early seventeenth century; the instrument of the Puritans, against their royalist enemies, when the Puritans came to power; the instrument of the royalists against the Puritans, after the Restoration; and, for a brief time, the instrument of the triumphant Whigs, after “the glorious Revolution” of 1688. But through all these vicissitudes, the stationers themselves steadfastly remained, what they had always been, eminently practical men; and they consistently protected their monopoly. (Patterson 1993)
After the restoration of the monarchy in 1660, pressure grew to recognize ‘a free press’. Aside from John Milton who protested censorship in his poem Areopagitica and called for a ‘free press’, John Locke proposed tolerance of different opinions – religious and political. Following the ‘Glorious Revolution’ of 1689, the last of the Licensing Acts was allowed to lapse in 1695. Government control was thereafter limited to post-publication libel law. This spurred development of a free press that could publish without the prior consent of the authorities.
The Stationers’ Company continued, however, to control prices, determine
what was published, and exclude outsiders. Working as a guild, the booksellers of
There were many attempts by the Stationer’s Company to restore the old
licensing system in the late 1690's and early 1700's, but it was not until 1710
that the first modern copyright act came into force: An Act for the Encouragement of Learning, by Vesting the Copies of
Printed Books in the Authors or Purchasers of such Copies, during the Times
therein mentioned, more commonly called the Statute of Queen Anne. It
had three objectives. First, it was
intended to prevent any future monopoly of the book trade by limiting the
duration of the right. Second, it was
intended to draw
The Statute of Queen Anne is considered a turning point in the history of copyright because, for the first time, the first law formally recognized an author's rights. Recognition of an author’s rights was, however, principally a device to attain its primary objective - abolition of the Stationer's monopoly (Feather 1988: 31-36). In effect, the Act was a trade regulation bill with much of its wording drawn directly from the Statute of Monopolies (Shirata 1999).
The Statute, in Common Law tradition, converted the customary bargains
and business practices of the Stationers’ Company into a common law of property
and liberty (Commons 1924: 229). All
rights of authors were subject to contract and could be (and generally were)
extinguished by a one-time payment.
Furthermore, no moral rights of the author were recognized while the
pecuniary rights of the ‘proprietor’, i.e., the publisher, were formally
Over time copyright protection was extended from books to maps and charts, sheet music, photographs, sound recordings and motion pictures. Until the 1980s, however, copyright in all Anglo-American countries was restricted to ‘works of art’. With introduction of software copyright, however, utilitarian works received copyright protection for the first, and probably not for the last, time. Copyright can emerge from any of the three knowledge domains – NES, HSS or the Arts – and can be obtained by natural and legal persons.
Trademarks (and marks of origin) are devices such as a word, logo or other mark pointing to the origin or ownership of a good or service that is reserved for the exclusive use of its owner as maker or seller. Today, its application has, de facto, extended to ‘domain names’ on the internet or world-wide web. The World Intellectual Property Organization (WIPO) has established dispute settlement mechanisms to resolve ‘cyber squatting’, i.e. registering a domain name using the name or trademark of an established business enterprise or celebrity, e.g. Julie Roberts, with the intention of selling that registration to its recognized trademark holder for a profit. At the international level, however, only the Common Industrial Property Regime of the Andean Community of 2000 makes explicit reference to web domain names (Chartrand 2001). If a trademark takes the form of a logo, it emerges from the Arts; if the form of a name or word from the HSS.
Registration and the payment of fees are required. A trademark is granted only for new marks so as not to confuse the public. It is available to both natural and legal persons. Unlike other forms of IPRs, however, trademarks can be renewed and can potentially be extended in perpetuity.
The word ‘trademark’ entered the English language in 1838. Functionally, however, it can be traced as
far back as to the thirteenth century including masons marks, goldsmiths marks, paper makers’ watermarks and watermarks
for the nobility, and printers’ marks.
While the 1618 case of Southern v How can be considered the birth
of commercial trademark law in
Know-how and trade secrets use a person – natural or legal - to embed knowledge in material form. Secrecy is used to protect both types and in most countries there is no formal statute. The term “know-how” entered the English language in 1838. Know-how refers literally to knowing how to do something, e.g., how to run a construction project. It includes knowledge and experience of an administrative, commercial, financial or technical nature used in running a business or performing a profession. It is experiential in nature, i.e., it is acquired through practice and experience. It also tends to be ‘tacit’ rather than ‘codified’ (see below) and embodied in an individual rather than in an external matrix. In most countries, know-how is protected by contract binding employees and other agents to confidentiality. When a natural or legal person (including a government) discovers that know-how has been revealed by an agent without permission, legal recourse is available through breach of contract before the courts. No registration is required. Know-how can be protected without time limit. It can emerge from any of the three knowledge domains – NES, HSS or the Arts.
Trade secrets can be defined as information of a technical or commercial nature that is not in the public domain nor generally available. It may be a formula, pattern, physical device, idea, process, compilation of information or other information that provides a competitive advantage in the marketplace. It is generally protected by contract binding employees and other agents to confidentiality. Normally the courts require that a trade secret be treated by its owner in such a manner that it can reasonably be expected to prevent the public or competitors from learning about it except by improper acquisition or theft. In the case of electronic data this includes using encryption and “password” technologies. The most famous trade secret is the formula for Coca-Cola. A trade secret may be embodied in written or other codified form or it may be tacit. No registration is required and there is no time limit on a trade secret. It may emerge from any of the three knowledge domains – NES, HSS or the Arts.
While know-how and trade secrets are often used as synonyms they need not be so. In the case of management and franchises, for example, know-how is usually accessible to third parties when being used. Single elements may be kept secret but the overall concept cannot be.
There are three markets in which knowledge can be bought and sold. The first is, in effect, a market for persons – natural and legal – possessing know-how including employees, contractors and consultants. The second is for packaged or ‘codified’ knowledge embodied in works protected by copyright, design, patent and trademark. It may be fixed in a utilitarian or non-utilitarian matrix. Finally, there is a market for what can be called ‘tooled’ or ‘black-box’ knowledge embodied in instruments and machinery. Tooled knowledge includes that which is protected by patents as well as knowledge in the public domain.
Tacit means ‘expressed or carried on without words or speech’. In effect, tacit knowledge is knowledge possessed by an individual that can not be explicated or codified (Kuhn 1996, 44, 191; Polanyi 1958). In this sense, it is silent knowledge.
Knowledge that cannot be explicated or codified cannot be transmitted by prescription. It can only be passed on by practice and demonstration. This restricts diffusion to personal contact. To learn by example is, in effect, to submit to a master and emulate his efforts. In the process, an apprentice unconsciously picks up the rules of a skill or craft, often including those not explicitly known to the master himself. The personal relationship between master and apprentice formed the foundation of the old guild system of such concern to Adam Smith. It was, in his time, the primary means of transmitting practical knowledge, from one individual to another and from one generation to another. It was also a means of inculcating the Sentiment of subordination among the lower classes (Rothschild 2001, 99).
Even in domains that rely primarily on codified (or systematized)
knowledge like the NES and HSS, tacit knowledge remains the foundation of all
knowledge for the simple reason that other forms - codified and tooled
knowledge (see below) - can only be actualized through an individual human
being. By definition, codified knowledge
must be decoded by an individual and tooled knowledge must be activated by the
individual. The critical role of tacit
knowledge such as ‘lab bench’ knowledge in the NES is highlighted by Kuhn in
his study of scientific revolutions (Kuhn 1996). Thus while the explicit or codified contents
of Science – the text book - can be successfully taught, the art of scientific
research cannot. This has been highlighted
It was found that in both cases, practice significantly improved ability to control the tasks, but had no effect on ability to answer post-task, written questions. In contrast, verbal instructions about the best way to control the tasks had no significant effect on control performance, although they did make people significantly better at answering the questions... these basic findings have been replicated and extended in a number of follow-on studies... (Berry 1997:2)
In effect, tacit knowledge is bought and sold in market for persons – natural and legal –including those for employees, contractors and consultants.
Codify means ‘to reduce to a code’ which, in turn, is a system of signals or symbols for communication. In the most general terms, codified knowledge refers to books, journals, libraries and computer data bases which someone, with appropriate training and experience (tacit knowledge), can ‘decode’. For communications to work the sender and receiver must both know the code.
Carl Sagan (1977) observed that a distinct characteristic of humanity is ‘extra-somatic’ knowledge, i.e., knowledge transmitted outside of the body, i.e., from outside the genetic code of the species yet still available to the individual. This ability to learn and pass knowledge on to others – through speech, visual images, writing, sound and image recording - contributes to the dramatically “different velocities of historical and biological evolutions” (Zilsel, 1940b). In effect, extra-somatic knowledge allows the individual to literally learn from the dead as well as from fellow human beings distant in time or space. In this sense, codified knowledge is ‘stored’ or packaged knowledge.
Put another way, humanity has used speech for more than 60,000 years; visual images for 40,000; and, the written word for 6,000 years. Each is a form of codified knowledge – the spoken language, the visual image, and the alphabet. More recently, digital or computer code has become an extra-somatic means of transmitting knowledge between individuals and generations.
For knowledge to be successfully communicated, however, both sender and
receiver must know the code. The
problems of transliterating from one alphabet (code) to another and then from
one language to another was a central concern of Renaissance Humanists (from
Greek and Arabic to Latin being the primary conversions). The problem continues to plague contemporary archeology,
e.g., undeciphered written languages such as Minoan
linear script A (3,000–1,500 B.C.E.) and that of the
With the exception of spoken language (and it too when recorded), codified knowledge involves more than a code. It also involves an extra-somatic medium – a matrix – into which the code is fixed. In this way codified knowledge is governed principally by copyright. In this sense even a patent in the form of its written and visual description is codified knowledge protected by copyright.
Through his study of communications media, Harold Innis identified a fundamental relationship between culture and the matrix or medium of communications. (Innis 1950, 1951). A culture is restricted in space, but extensive in time, i.e. it has duration, to the extent its dominant communications medium is durable, e.g. stone, clay or parchment. Alternatively, a culture is extensive in space, but restricted in time, to the extent its dominant communications medium is non-durable but easily transported, e.g. papyrus and paper. Using this hypothesis Innis attempted to explain the rise and fall of empires.
Innis’ student, and later colleague, Marshall McLuhan, took this relativism, first to “the medium is the
message”, and then to human consciousness being fundamentally altered by the
emergence of new electronic communication media (McLuhan
1978). In his work he also identified
the differential impact of specific codes - alphabets. Thus while we recognize the fundamental
difference between the perceptions of literate and preliterate peoples, we
generally do not appreciate the impact of different alphabets. It is possible, even today, to encounter
highly educated people who are quite unaware that only phonetically literate
man lives in a ‘rational’ or ‘pictorial’ space.
The discovery or invention of such a cognitive space that is uniform,
continuous and connected was an environmental effect of the phonetic alphabet
in the sensory life of ancient
Since the invention of recording technology another dimension has been added to codified knowledge: tooled knowledge (see below) in the form of recording and play back equipment. Without such equipment (and the tacit knowledge to operate it) codified knowledge becomes an ‘artifact’, i.e., a ‘dumb’ indecipherable object like a computer disc or a vinyl ‘45’ sound recording. Decoding involves two steps. In the first instance it is dependent on operating playback equipment (tooled knowledge); in the second, it depends on an individual able to decode the playback, i.e., tacit knowledge.
Codified or systematized knowledge plays a lesser role in the Arts than in the NES or HSS (Busch 1985; Robinson 1982). There is a well documented gap between graduation from university in the Arts and attainment of professional status (Black et al 1977; Blume 1978; Lemieux & Young 1981). Art is learned by doing; it is experiential. Old craft methods, apprenticeship and master classes in the Arts survived the abrogation of the Statute of Artificers in 1814 and remain the most effective methods for the transmission of knowledge in the Arts.
Codified knowledge is sold in markets for both consumer and producer goods, e.g., books, recordings and technical manuals. These markets involve the buying and selling of goods protected by copyright, design, patent and trademark rights including those for which protection has lapsed, i.e., in the public domain.
Tooled or ‘black-box’ knowledge is like codified knowledge in that it is extra-somatic and requires tacit decoding. It is different, however, with respect to the type and level of tacit knowledge required. As an example, consider the common electric hand drill.
Functionally it makes a hole. Without a drill one can manually use a simpler tool like a spike. This requires knowledge of materials technology, e.g., balsam won’t work well. One either pounds away or rotates the spike between one’s hands but with little control or effect unless one spends a long period of time developing the tacit knowledge of how to do so. If one instead turns a crank handle to drive a hardened specially shaped shaft (embodied knowledge of gears and pulleys as well as bits) then the operator can achieve much more control and effect. One has invented the hand drill.
If one then powers the crank by electricity (knowledge of electric motors), then at the push of a button one hand can achieve even more control and effect. If one then computerizes the button, one frees the hands, body and mind of the operator. One has invented a computerized machine tool that embodies knowledge streams of materials technology, mechanics, electricity and computers - all in one tool.
At a given point in time there will be a current ‘state of the art’. As time passes, new knowledge accumulates and a process of refinement begins. The sum total of knowledge, and the number of possible interactions between different stocks of knowledge, increases. As it increases the amount of tacit knowledge required to accomplish a given task diminishes to: What button do I push? That is all the tacit knowledge required. The tooled knowledge in the device becomes opaque in the form of a ‘black box’ of which the operator has no need to understand in order to operate. In this sense, tooled knowledge is like von Havek’s price system in that it exhibits great economy of knowledge (Hayek 1937, 1945, 1989). And like the price system, tooled knowledge exists in markets for both consumer goods (e.g., video recorders) and producer goods (e.g., machine tools).
Using this argument, physical capital is knowledge embodied in functional objects. Knowledge has been used to transform raw materials to higher and higher levels of organization – generations of tools. The argument can be extended to financial capital in the form of financial instruments, or tools, such as futures, options, mutual and hedge funds These involve the accretion and embodiment of knowledge gained from tacit experience with the simpler financial tools of the past.
Tooled knowledge is bought and sold in markets for instruments and machinery. These may include knowledge protected by patents as well as that in the public domain. The term ‘tooled knowledge’ has been adapted from J.A. Schumpeter’s description of economics as “a recognized field of tooled knowledge” (Schumpeter 1954: 143).
Relative to the old labour theory of value, if one replaces labour as input by knowledge, then capital becomes not hours of labour but rather specific knowledge - protected by IPRs or in the public domain - embodied in instruments and capital plant & equipment. In this view, if scientific instruments have extended the human senses along the micro-macro-continuum, then capital plant and equipment have extended the human grasp horizontally out into the material world. At the push of a button, a machine or mechanism does work that untold generations of humans did by hand, or not at all. Of course, tacit knowledge, i.e., a living breathing human being, is required to activate tooled knowledge, to know which buttons to push and in what order. Similarly, tacit knowledge is required to decode codified knowledge so that it becomes operational. In this sense, without the active mediation of a human being, codified and tooled knowledge remain dumb artifacts like a recording without a playback device. It is for this reason - the need for the tacit knowledge of an individual human being to unlock codified and activate tooled knowledge - that one can meaningfully speak of a labour theory of knowledge and its corollary – a knowledge theory of capital.
The taxonomy for a labour theory of knowledge (Fig. 1) based on the four psychological faculties of knowledge – Reason, Revelation, Sentiment and Sensation - consists of:
· three dominant contemporary and institutionalized knowledge domains – the Natural & Engineering Sciences (NES), the Humanities & Social Sciences (HSS), and the Arts;
· three generic categories of intellectual property rights (IPRs) that temporarily convert knowledge into property that may be bought and sold in markets – designs & patents, copyrights & trademarks, and know-how & trade secrets – before entering the public domain forever;
· three material forms in which knowledge must be fixed for IPRs to exist – utilitarian and non-utilitarian matrices as well as the person – natural and legal; and,
· three types of knowledge markets – the markets for tacit, codified and tooled knowledge.
To conclude, I will demonstrate the strong and weak interactions of the component parts of the model (vertical vs. horizontal) to illustrate its descriptive meaningfulness and explanatory power. To restate its foundation: only an individual human being can know and this is the basic premise of the labour theory of knowledge.
Vertically, the four columns making up the main face of Figure 1 reflect empirical
reality or generally recognized theoretical forms of knowledge – excepting my
neologism, ‘tooled knowledge’. Knowledge
domains (the NES, HSS & the Arts) are represented in
Horizontally, the three rows making up the main face of Figure 1 do not as strongly reflect empirical reality as the vertical columns. Nonetheless, they do describe meaningful aspects of the real world. New knowledge generated by the NES does tend to take the legal form of patents fixed in a utilitarian matrix in the form of tooled knowledge, i.e., scientific instruments as well as capital plant and equipment. New knowledge generated by the HSS does tend to take the legal form of copyrights fixed in a non-utilitarian matrix in the form of codified knowledge. A descriptive limitation is that both the NES and the Arts also generate legal knowledge property in the form of copyrights. New knowledge generated by the Arts does tend to take the legal form of know-how fixed in a natural person (the artist) in the form of tacit knowledge. A descriptive limitation is that both the NES and HSS also generate legal knowledge property in the form of know-how.
With respect to the right side of Figure 1, vertically the knowledge faculties – Reason, Revelation, Sentiment and Sensation – correspond to faculties recognized by both applied and theoretical analytic psychology – Thinking, Intuition, Feeling and Sensation. Horizontally, the relationship between faculties of knowledge and real world industries is the weakest relationship identified by the model. These relationships are based on the assumption that if circular causality is operative from the individual faculty to the societal plane then one would expect to find in the economy industrial sectors corresponding to each knowledge faculty: Reason & a Science Industry; Sentiment & an Arts Industry; Revelation & a Spiritual Industry; and, Sensation & a Pleasure Industry. These knowledge-based industrial categories contrast with conventional economic categories of: the Primary Industries including farming, fishing, forestry and mining; the Secondary Industries of manufacturing; and the Tertiary Industries of services.
In summary the labour theory of knowledge claims ordinality – more or less knowledge, of this or that type. Second, it does not claim geometric elegance other than for taxonomical purposes (Fig. 1). Third, it claims to explain the nature of capital, specifically in the form of tooled knowledge. The theory involves the relationship between four psychological faculties of knowledge, three knowledge domains, three forms of intellectual property rights, three matrices in which knowledge must be fixed for such property rights to exist; and, three generic markets for knowledge.
It was not my intention to revivify the labour theory of value nor to displace the Neo-Classical solution of supply and demand but rather to compliment them. I have attempted to retool the labour theory of value as a labour theory of knowledge and to expose its corollary – the knowledge theory of capital. I look forward to feedback and criticism of my efforts and hope that they will contribute to a more robust understanding and appreciation of the emerging knowledge-based economy.
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