I recognized that information was, in many respects, like a public good, and it was this insight that made it clear to me that it was unlikely that the private market would provide efficient resource allocations whenever information was endogenous.
As I noted in my Nobel lecture, an early insight in my work on the economics of information concerned the problem of appropriability - the difficulty that those who pay for information have in getting returns.
The theory of mechanism design can be thought of as the 'engineering' side of economic theory.
I entered economics because of a course I took on 'information economics,' which I found fascinating.
[Intellectual property] cannot, in nature, be a subject of property. He who receivers an idea from me, receives instructions from me without lessening mine, as; as he who lights his taper at mine, receives light without darkening me.
The reason for the success of this somewhat communist-sounding strategy, while the failure of communism itself is visible around the world, is that the economics of information are fundamentaly different from those of other products.
Information doesn't want to be free. Information wants to be valuable.
My research, even before 1972, moved in directions beyond those cited for the Nobel Memorial Prize. Most of it, in one way or another, deals with information as an economic variable, both as to its production and as to its use.
The 1970s was the decade of developments in the new area of information economics. Search theory, which emphasized the need to gather information, was joined by models that featured asymmetric information, the case in which information differed across individual agents.
Leo Hurwicz is the father of mechanism design theory and has inspired much of my work, and Roger Myerson is an old friend and collaborator and a tremendous economist.
