Subject: Re: Tom W. Bell paper
From: Thomas Lord <>
Date: Sat, 02 Sep 2006 22:50:41 -0700

Don Marti wrote:
> Yes, and so you would have to (1) do R&D and (2) take
> a position in the market based on "predicting" the
> success of your own project in order to profit from
> the market.  (Yes, it's a lot like an assassination
> market.)  In the energy-efficient computer example,
> you invent the machine that can pass the test, buy
> "yes" contracts, pass the test -- and immediately
> have your market gains to plow into future research,
> instead of having to navigate the patent system.

Your obligation here isn't simply to show how an
innovator could win a game in a Spex, given compliant
counter-parties.   You need to show why those counter-parties
would enter the market in the first place (and you've just
provided an argument that they would not).

> Historical example of technological and business
> process innovations driven by a risk allocation
> business:
> Hartford Steam Boiler Inspection and Insurance Company 

Insurance is not just about risk allocation -- it's about
the allocation of future revenues from an investment fund
to which the insured make regular contributions.  It's
not zero-sum.

Now, you very well might be able to best Bell by further
developing your idea.   Insurance may very well be able
to suggest some market models that could truly "whup"
copyrights and patents.   You might be on to something there.
To the degree you are, you are departing from, not supporting