Large planetoid in empty space

Asteroids and the Wild West

May 3, 2012 • Businesses, Demand, Supply, and Markets, Economic Debates, Economic History, Innovation, Macroeconomic Measurement, Uncategorized • 100 Views    No Comments

I’ve been wondering who should own an asteroid.

This takes me back, for a moment, to colonial Massachusetts. When many of the first colonists arrived, they farmed communal fields where some got less and others got more. Soon though, unhappy sharing, those with less moved westward. Their goal? Generate wealth on their own fields, farms, homes.

As a result, from one new settlement to the next, moving westward, public property became private property.

Maybe, an asteroid is rather similar.

A new firm, Planetary Resources, with funding from by Google’s creators and Avatar’s James Cameron, has its eyes on the wealth of the universe. Beginning with robotic earth orbiting observatories for collecting and selling data about asteroids, their ultimate objective is to mine asteroids.  Space based platinum could be worth billions. (A new statistic? GUP–Gross Universe Product)

One glitch might be the 1967 United Nations Space Treaty. Signed by the US and 99 other nations, the treaty says that, “Outer space, including the Moon and other celestial bodies, is not subject to national appropriation by claim of sovereignty, by means of use or occupation, or by any other means.” One researcher called outer space a “celestial commons.”

Does that include asteroids?

The Bottom Line: I am concerned about incentive. Everywhere, private property provides the incentive to innovate and develop resources.

And that returns us to the massive resource wealth of the US that entrepreneurs developed because it could become their private property.

Reading about Planetary Resources in these articles was such a pleasure, here, here, and here.

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