The essential digital-economics library

My older brother used to joke that when I wanted to learn to play baseball, I read a book. Mike’s style: Pick up the ball and throw it harder than seemed humanly possible.

Hey, we all learn differently, right? So when friends – especially newsroom lifers – ask how they can catch up with the digital revolution, I default to books. These are some of the titles that formed my thinking about information economics and the digital revolution.

Read these and you’ll understand that “information wants to be free” isn’t religious sloganeering – it’s the logical outcome of perfect, free copies. You’ll also understand how that same force is shredding the monopolies that traditional media have always relied on to make their money.

Information Rules: A Strategic Guide to the Network EconomyInformation Rules: A Strategic Guide to the Network Economy – Carl Shapiro and Hal R. Varian: An utter classic. The late-‘90s references don’t seem dated (as with too many business books). Instead, they serve to prove the fundamental points Hal makes in his teaching, and in his work at a Silicon Valley startup you may know: Technology changes. Economic fundamentals to not. But they do yield some surprising results when technology modifies key elements in the economic equation. Perfect for a general audience – the math is kept to a gentle minimum.

The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail – Clayton M. Christensen: The funny thing? Bosses throughout the media business (including most of mine) read it. Then they went out and made the very mistakes it warns about anyway.

The Long Tail – Chris Anderson. Yes, it seems obvious now: When it costs nothing to stock a million books, or every CD ever made, someone will – and someone else will buy ‘em. It wasn’t obvious at the time. Unlike other business best-sellers (Dow 36,000, anyone?) this one is aging gracefully because it offers genuine insight, not just bloviation.

What Would Google Do – Jeff Jarvis. Spare me the “web triumphalist” rants. Jeff isn’t some new-media radical who secretly enjoys layoffs and others’ pain. He’s had more great media jobs than almost anyone, and did them well. WWGD? captures the essence of the link economy – and Google’s canny use of it.

Everything is Miscellaneous – David Weinberger. A lot of reporters I know succumb to the Dewey Decimal Theory of Life: Everything has a place, and only one place. Weinberger shows how the Web’s defiance of easy categorization isn’t a fault – it’s a virtue.

All the News That’s Fit to Sell: How the Market Transforms Information into News – James T. Hamilton. Hamilton offers compelling, rational theories, based on microeconomics, for why local television devolves to crime, weather and tear-jerkers. Or why salaries for blow-dried anchors eclipse the reporters and producers who do the real heavy lifting. Or how technology is destroying the scarcity that allowed “objective” journalism to emerge. This is tougher sledding than most – this is an academic work, not a breezy business read – but it’s worth the effort.

Think something’s missing? Think one of these books stinks? Let me know in the comments.

EDITED TO ADD: In the year or so since I wrote the original version of this (for a discussion), a couple others have earned their way onto the list, both concerning the shift in media power to consuemrs:

Here Comes Everybody is Clay Shirky’s discerning look at how technology breaks down the barriers between media producer and consumer. Broadly, that allows crowdsourcing. But more fundamentally, it shatters the economic and political rules that allowed modern media empires to emerge. While scholarly and rigorous, it’s extremely well written and accessible, and a must read for journalists who want to cope with change.

In a similar vein, Jeff Howe’s Crowdsourcing focuses specifically on how businesses (including media) can and are using the collective knowledge of their customers to succeed.  

Despite the similar topics, each has its own unique value to a well-rounded digital-media and economics library.


#1 Tim Windsor on 01.04.10 at 8:46 pm

I’d add The Cluetrain Manifesto which, ten years on, is as true as it ever was about how communication works in the digital age. Markets are conversations.

Also Reality Check, by Guy Kawasaki, to help kick-start the reptilian entrepreneurial part of the brain.

Finally, an aside about the famous “Information wants to be free” quote above. Let’s not forget that, when originally uttered by Stewart Brand, it was in a context that sounds, as the old Charlee jingle had it, “kinda now”:

“On the one hand information wants to be expensive, because it’s so valuable. The right information in the right place just changes your life. On the other hand, information wants to be free, because the cost of getting it out is getting lower and lower all the time. So you have these two fighting against each other.”

…which I believe just may be the point of your blog, sir.

#2 tgd on 01.04.10 at 8:59 pm

Funny that you mention the entire Stewart Brand quote. The extremists on both edges – those who believe “information wants to be free” is a religion, and those who think thems fightin’ words – have almost certainly never read the complete quote.

But why ruin a good polemic with facts?

#3 A to the news industry from Hal Varian | Tom Davidson on 03.09.10 at 10:11 pm

[…] field of information economics (I’ve given away several dozen copies over the years, and it’s Book No. 1  in my personal essential bibliography of information economics). And odds are if you studied […]

#4 Resources for journopreneurs | Tom Davidson on 05.20.10 at 1:07 pm

[…] I freely admit that I’m a history geek (How many Virginians does it take to change a light bulb? Four – one to unscrew, three to give you the history of the old one all the way back to the landing of the first English colonists at Jamestown.) If you want to understand the context of today’s media revolution, here are some terrific (I’d say essential) readings. […]

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