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economics

My blog doesn’t depress wages


I’m going to go out on a limb here and say Paul Bradshaw is wrong. The argument goes like this: drive up the supply of journalists, drive down the unit price of a story. Sounds fine, until you think through the argument more carefully. It only matters that hacks bloggers are giving away drivel content for free if their competition drives wages down.

What reduces the value of something economically? Increased supply or reduced demand are two key factors. And indeed, journalism as a profession has been consistently devalued economically as a result of one of those factors: increasing numbers of people who want to be journalists and who will work for free, or for low wages. The result is that the wages of journalists are very low – a pattern which predates the internet and the rise of blogging, etc.

This is rife with the same fallacies that convinced Lou Dobbs that unskilled immigrant labor drives down middle class American wages. Bradshaw’s pseudo-economic analysis treats journalists like fungible, undifferentiated commodities, just about the same as feed corn.

There are lots of markets where giving some stuff away doesn’t make the other stuff worthless. In fact, free-beer software creates entire business ecosystems for software, hardware, and services. Strategic giveaways are good business strategy. For more on that, read Tapscott and Williams or Chris Anderson.

Then there’s the question of whether blogs and papers are in the same market. They’re not. Newspapers do the hard job of editing: screening, curating, and fact-checking stories. The whole reason that you’ll pay to read the Financial Times but not my blog is because of their hard-won reputation for excellence.

If your newspaper is printing roundups of the “Here’s what the blogs are saying about…” variety, it’s time to switch your subscription.

Next, although entry-level journalists are badly paid, that doesn’t necessarily have anything to do with the economics of Nicholas Kristof’s salary. Kristof’s pay goes up or down based on what the papers can afford, which is driven by subscriptions and advertising. In fact, the more liars and bad writers are out there with healthy audiences, the bigger is the pie for the best journalists to fight over. Effectively, that’s just a few million more hacks that Kristof is better than. The best columns in journalism are a classic positional good: their worth is determined by how much better they are than their competitors.

Unless Joe Q. Public seriously gets so sleepy befuddled distracted reading my blog that he forgets to click through to the NYT op-ed page, it’s hard to draw a connection between the audience for their columns and the audience for mine.

What’s the most likely relationship between pickup basketball attendance and Shaquille O’Neal’s salary? I would guess NBA teams pay better when more amateurs play basketball.

Now it’s possible that newspapers used to make a play similar to cable television by bundling Reuters feeds in with great journalism. Here is a possible scenario: what if papers used to buy the feeds at wholesale prices and sold them at retail, then took the proceeds to underwrite sound editorial practices, expensive offices for foreign correspondents and star columnists. Enter feed aggregators on the Web, and the business model takes a hit. Anyone that was buying the Wall Street Journal and only reading “What’s News” can now afford to cancel. (With cable, I’ve been waiting for the day when I can tell the good people of Comcast, “No really, I’d only like NESN and Comedy Central. You keep the other 50 channels and pro-rate my monthly bill for the difference.”)

For another comparison, take academic publishing, which effectively doesn’t pay for articles. Academics don’t write out of sheer altruism. They do it because it’s the ultimate signal of research quality, extremely costly to fake and the sine qua non of tenure promotion, book deals and competitive grants. Academic publishing has exploded recently and journal fees have risen despite making no contribution to academic salaries.

All of which is to say, the practice of abusing interns isn’t unique to journalism; the market for “news stories” doesn’t necessarily look like first-semester supply and demand curves; and the woes of journalism’s labor market aren’t the fault of bloggers.

Check Paul Bradshaw’s logic, …

What reduces the value of something economically? Increased supply or reduced demand are two key factors. And indeed, journalism as a profession has been consistently devalued economically as a result of one of those factors: increasing numbers of people who want to be journalists and who will work for free, or for low wages. The result is that the wages of journalists are very low – a pattern which predates the internet and the rise of blogging, etc.

Angela’s point, however, is not about the economic value of professional journalism but the editorial value – the quality, not the quantity.

There’s an obvious link between the two. Pay people very little, and they won’t stick around to become better reporters (witness how many journalists leave the profession for PR as soon as they have families to feed). Rely on interns and you not only have a more unskilled workforce but the skilled part of your workforce has to spend part of its time doing informal ‘training’ of those interns.

So where do bloggers come in? Angela mentions them in two senses: firstly as being chosen over experienced journalists, and second as part of a list of people willing to work for little or for free.

But, unlike the labels ‘intern’ and ‘freelance journalist’, ‘blogger’ is a definition by platform not by occupation, and takes in a vast range of people, some of whom are very experienced journalists themselves (with high rates), and some of whom have more specialist expertise than journalists. It also includes aspiring journalists and “cut price freelancers”.

Does their existence ‘devalue’ journalism? Economically, it certainly increases the supply of journalism and so drives down its price.

But editorially? Well, here we have to take in a new factor: bloggers don’t have to write about what publishers tell them to. And most of them don’t. So while the increase in bloggers has expanded the potential market for contributors – it’s also expanded the content competing with your own. Competition – in strictly economic terms – is supposed to drive quality up. But I’m not going to argue that that’s happening, because this is not a market economy we’re looking at, but a mixed one.

… responding to Angela Saini.

For anyone who says that it’s impossible to survive as a journalist these days and get paid a decent wage, I’d say, if you keep up your skills (including multimedia skills), quality and standards, then you can. I have, as have many other writers and broadcasters I know. Whatever may happen to the industry, editors and readers can’t resist brilliant, exclusive stories. So don’t get sucked into the idea that journalism isn’t a profession. And know your worth.
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About Ben Mazzotta

Ben Mazzotta is a postdoc at the Center for Emerging Market Enterprises (CEME). His study of the Cost of Cash is part of CEME's research into inclusive growth.

Discussion

3 thoughts on “My blog doesn’t depress wages

  1. Thanks for the more detailed and sophisticated exploration of the economic side of my point, which I admit was expressed rather crudely in my hurry to get to the real point

    I agree with you entirely – in fact, I’m not sure if you read to the end of my blog post, or misunderstood it? I am not saying that bloggers have had any impact on journalists’ wages because they are not a significant part of the commercial decisions taken by publishers (or as you put it, they’re in a different market). But I do know that publishers have historically paid journalists less than they otherwise would because, quite simply, they know that there are plenty of others who want the job (not, by the way, bloggers).

    Clearly this is not the case for all journalists either – those who have value over and above producing commodity news obviously have more value.

    Anyway, I have a further blog post drafted which looks more specifically at the value in the journalistic process – some of which you already touch on… Meanwhile, I’ll update the blog post with a link to this, as I think it fleshes out some of the subtleties to the blunt picture I painted – thanks.

    Posted by Paul Bradshaw | October 29, 2010, 2:32 pm

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