iPods set the tempo in currency

The Economist's BigMac index has had his fortune as informal way of measuring the purchasing power parity (PPP) between two currencies.

Now Commonwealth Securities has launched an iPod index, based on the cost of the 2 gigabyte iPod Nano player as a way of showing if a currency is overvalued. BBC has a report on it.

P.S.: If you plan to buy a iPod and you leave up north you should head your way into Canada.

Economics of Intellectual Monopoly

I discovered today that David Levine has a nice page discussing the economics of intellectual monopoly, descriptively titled Against Intellectual Monopoly.

This page contains a book (freely readable) written by Levine and Boldrin. Very enjoyable (as much as an economic book can be). The book is composed of ten chapters. I found particularly interesting Chapter 8: Does Intellectual Monopoly Increase Innovation? Here an excerpt from that chapter.

But does intellectual monopoly actually lead to greater innovation than competition?

From a theoretical point of view, the answer is murky. In the long-run, intellectual monopoly provides increased revenues to those that innovate, but also makes innovation more costly. Innovations generally build on existing innovations. While each individual innovator may earn more revenue from innovating if he has an intellectual monopoly, he also faces a higher cost of innovating: he must pay off all those other monopolists owning rights to existing innovations. Indeed, in the extreme case when each new innovation requires the use of lots of previous ideas, the presence of intellectual monopoly may bring innovation to a screeching halt.

David's Levine home page also has interesting links and materials.