esoltas

Someone beat me to posting the Kauffman research... Also, the investment to GDP ratio is here, although a lot of the decline was housing: http://research.stlouisfed.org/fred2/graph/?g=14LZ.

It's true that I'm talking about all different types of rents in the article. I've written about land rents and land taxes here, if you're interested: http://esoltas.blogspot.com/2012/06/on-land-taxes.html. Also, as old as the Henry George analysis of land rents is, it is still quite relevant. If you look at some of the rebuttals to Piketty's capital (eg., this one: https://ideas.repec.org/p/spo/wpecon/infohdl2441-30nstiku669...), what you see is that most the growth in capital/income ratios comes from increases in the value of land capital. That would suggest George is still relevant to our world, and that conversations about IP might be secondary.

Yep, and I define it at the top of the most that way. Rent = profit in excess of opportunity cost of the production factor.

Soltas (the author) here. What I meant by "rents are not always bad" is that "rent" is a positive (i.e., value-free) concept, not a normative (moral) one. "Rent" in economics merely implies that the profits are in excess of a competitive-equilibrium outcome/allocation. In this case, the competitive outcome is perverse -- nobody innovates because, without IP, you pay for the cost of R&D but "copycats" can steal the idea without paying. (It's a prisoners' dilemma.) So profits from a patent are rent, insofar as they come from the protection per se. As I acknowledge, I think those rents are economically useful -- as an economist, I don't have anything interesting to say as to whether they are morally acceptable, as you discuss in your post. For example, it's a fair argument to say that "ideas should be free," and that the purpose of IP is not to enrich/honor/etc the innovator but merely to give him the incentive to contribute the idea to the social good. Or you might argue the opposite of that. I don't really have an opinion. Hopefully this clarifies the way economists use the word "rent."