- "Information economics or the economics of information is the branch of microeconomics that studies how information and information systems affect an economy and economic decisions."
This subfield is concerned with how information is produced, distributed, and consumed, including the impact of information on economic decision-making.
Information asymmetry: The unequal distribution of information between parties in a transaction, resulting in one party being at a disadvantage.
Market failure: A situation in which the market mechanism fails to allocate resources efficiently resulting in inefficiency, inequality or absence of complete information.
Adverse selection: A situation where an individual with private information uses it to obtain a favorable outcome, often at the expense of others.
Moral hazard: A situation where one party has an incentive to take risks because another party bears the cost of that risk.
Principal-agent theory: This theory explains the relationship between principals and agents, and how their interests may not always be aligned.
Search costs: The costs and time involved in discovering and obtaining a good or service.
Transaction costs: The costs associated with the process of exchanging goods, including costs incurred by buyers and sellers.
Network effects: The phenomenon where a good or service becomes more valuable as more people use it.
Intellectual property rights: The rights that protect an individual or company's intellectual creations, such as patents, trademarks, and copyrights.
Information goods: Goods that can be digitized and distributed easily, such as music, movies, and books.
Online advertising: The use of the internet to advertise products or services.
Digital piracy: The unauthorized use or reproduction of someone else's digital material, such as music, videos, or software.
Content aggregation: The process of collecting and curating information from different sources into one platform or service.
Media consolidation: The trend towards ownership of multiple media outlets by a small number of conglomerates.
Open-source software: Software that is free for anyone to use, distribute, and modify.
Data analytics: The process of examining large sets of data to uncover patterns, trends, and insights.
Information security: The protection of information from unauthorized access or use.
E-commerce: The buying and selling of goods and services over the internet.
Digital divide: The gap between those who have access to modern technologies and those who do not.
Crowdsourcing: The process of obtaining services, ideas, or content by soliciting contributions from a large group of people, especially through the internet.
Advertising economics: It deals with the study of the effectiveness and the economics of advertising. It analyzes how advertising affects consumer behavior and how it can be used as a tool for creating a brand image.
Cultural economics: It concerns itself with the economic aspects of culture, the arts, heritage, and creative industries as a vital part of the economy.
Digital economics: It is concerned with the study of how digital technologies are transforming the media industry, from the rise of online advertising to the increasing importance of social media.
Entertainment economics: It deals with the study of the production, distribution, and consumption of entertainment products such as music, movies, TV shows, and video games.
Intellectual property economics: It is concerned with the economic analysis of intellectual property laws such as patents, copyrights, and trademarks.
Journalism economics: It deals with the economics of the news industry, including how newspapers, TV stations, and online news sites generate revenue and how they are adapting to the digital age.
Market research economics: It deals with the methods of research, and statistical analysis that is used by companies to analyze consumer behavior, preferences, and trends.
Media ownership economics: It deals with the study of how media companies are owned, operated, and regulated.
Media pricing economics: It is concerned with the study of how media products such as TV ads, newspaper ads, and online ads are priced and their effects on market demand and revenue of the media companies.
Sport economics: It deals with the study of how sports franchises, events, and organizations are organized, financed, and managed by the media industry.
- "Examples include computer software (e.g., Microsoft Windows), pharmaceuticals, and technical books."
- "Once information is recorded 'on paper, in a computer, or on a compact disc, it can be reproduced and used by a second person essentially for free.'"
- "Without the basic research, initial production of high-information commodities may be too unprofitable to market, a type of market failure."
- "Government subsidization of basic research has been suggested as a way to mitigate the problem."
- "The subject of 'information economics' is treated under Journal of Economic Literature classification code JEL D8 – Information, Knowledge, and Uncertainty."
- "There are several subfields of information economics. Information as a signal has been described as a kind of negative measure of uncertainty."
- "Information economics is formally related to game theory as two different types of games that may apply, including games with perfect information, complete information, and incomplete information."
- "Experimental and game-theory methods have been developed to model and test theories of information economics, including potential public-policy applications such as mechanism design to elicit information-sharing and otherwise welfare-enhancing behavior."
- "An example of game theory in practice would be if two potential employees are going for the same promotion at work and are conversing with their employer about the job."
- "Whilst the less informed employee may be willing to accept a lower pay rise for the new job, the other may have more knowledge on what the role's hours and commitment would take and would expect a higher pay."
- "The employee with more information may misinform the other one about the value of the job for the work that is involved and make the promotion appear less appealing and hence not worth it."
- "This brings into action the incentives behind information economics and highlights non-cooperative games."
- "There have been influential advances in the study of information asymmetries and their implications for contract theory, including market failure as a possibility."
- "Potential public-policy applications include mechanism design to elicit information-sharing and otherwise welfare-enhancing behavior."
- "It includes complete and scientific knowledge as special cases. The first insights in information economics related to the economics of information goods."
- "Information economics studies how information and information systems affect an economy and economic decisions."
- "Information as signal has been described as a kind of negative measure of uncertainty."
- "Without the basic research, initial production of high-information commodities may be too unprofitable to market, a type of market failure."
- "Government subsidization of basic research has been suggested as a way to mitigate the problem."