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ThesisUniversity of Iceland>Félagsvísindasvið>B.A./B.Ed./B.S. verkefni>

Please use this identifier to cite or link to this item: http://hdl.handle.net/1946/11245


News economics. How property rights and the price mechanism influence media content

June 2012

Deterioration of news quality over the last decade or more has been widely reported by media studies scholars, officials and journalists alike. The theories provided by critics to explain the phenomenon are somewhat unconvincing thus far. This thesis attempts to contribute to the literature on news quality by explaining it as a function of property rights using the New Institutional Economics paradigm within a flexible and original analytical framework. It is argued that “common pool news“ based on widely recognised information is overproduced due to similar reasons that common pool resources are overharvested. It is also argued that advances in information technologies have eroded property rights by making copying of original news, or scoops, easier, thus making it harder for the originators of scoops to reap the benefit of their production, causing an underemployment of resources to independent investigation and analysis. Simple models are presented to support both hypotheses, as well as data on media coverage in the years preceding the collapse of the Icelandic banking system. Some remedies are suggested, including government subsidies. General recommendations for an optimal subsidy scheme are made, supported by a six country overview of media subsidies in western Europe.

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