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Trading facts: Arrow's fundamental paradox and the emergence of global news networks, 1750-1900

Bakker, Gerben (2007) Trading facts: Arrow's fundamental paradox and the emergence of global news networks, 1750-1900. Working papers on the nature of evidence: how well do 'facts' travel?, 17/07. Department of Economic History, London School of Economics and Political Science, London, UK.

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Abstract

The nineteenth century saw the advent of news agencies that became well-coordinated global organisations with large networks of correspondents, such as Reuters, Havas, Wolff-Continental and Associated Press. Essential features of these agencies were substantial fixed and sunk set-up costs, high fixed operating costs, a marginal cost of supplying news to an additional customer of virtually zero, and the quasi-public good character of information, which had implications for the organisational form, marketing and pricing. To solve Arrow’s fundamental paradox of information, agencies adopted subscriptions, because this made the marginal price of news zero. The news networks were operated by unique organisations whose evolution interacted with new technologies. The paper investigates how the news agencies emerged, whether and how they co-evoluted with infrastructure firms, what business models they pioneered, how they developed/discovered these models, and how they became encapsulated in an oligopolistic industry structure in the course of the nineteenth century.

Item Type: Monograph (Working Paper)
Official URL: http://www.lse.ac.uk/collections/economicHistory/
Additional Information: © 2007 The Author
Library of Congress subject classification: D History General and Old World > D History (General) > D204 Modern History
Sets: Departments > Economic History
Collections > Economists Online
Collections > How Well Do 'Facts' Travel?
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Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: 17/07
Funders: http://www.leverhulme.ac.uk/, Economic and Social Research Council
Projects: Large-Scale Technological Change
Date Deposited: 04 Feb 2009 17:27
URL: http://eprints.lse.ac.uk/22519/

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