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This lecture explores the challenges of innovation appropriation, using a metaphor of a fisherman village to illustrate the dilemma of exclusivity. It delves into the distinction between physical and informational goods, discussing the difficulties in privatizing ideas. Various strategies are presented, such as artificial exclusivity through patents and secrets, and natural exclusivity by exploiting the time delay in imitation. The lecture also covers the concept of selective revealing within communities to regulate innovation sharing. It concludes by discussing the importance of capturing innovation value and the trade-offs between different appropriation mechanisms.