Matt Yglesias says of the tendency of internet alternatives (including blogs like TPM) to substitute for the formal reportage of traditional media that  "the downside, however, is that when you have big positive externalities associated with a particular service (in this case original reporting) the consequence is going to be underproduction of the service relative to what would be optimal."

I live in a world where "positive externalities" that "result in overproduction of services" because they are "public goods" are the core elements of the  vocabulary of morning chats around the water cooler.  I appreciate, however, that there are many sophisticated TPM readers who do not use the language of micro-economics to describe their moral universe.

Because Matt's point is so important, indulge me in being  a little didactic and amplifying the concept at the center of his post.  

First the definitions.

Externalities are side effects of production or consumption that impose costs on or provide benefits to third-parties who are not directly involved in the activity.  These can be either negative or positive.  Positive externalities are side-effects that provide benefits to one or more people beyond the producer, while negative externalities harm others.

Free or almost free access to the reporting of the New York Times, the Washpost, and the Daily Telegraph constitute public goods.  A public good is a good that is nonrival in consumption. This means that one person's consumption does not reduce the quantity or quality of the good available to other consumers.

The problem with public goods is that no individual has an incentive to pay for the good. Since it is inefficient, and not always feasible, to exclude people from consuming a public good, people can consume it even if they do not pay for it at all.

In such a situation, each person has an incentive to be a "free rider" and to let others pay for the good. The consequence, therefore, of course, is that the public good will be either underproduced or not produced at all if the provision of such goods were left to the market.

So Matt is saying that with most of us free-riding on the real news reportage of the good gray New York Times, the long term trend will be for there to be less and less of that real reportage produced.

The clever ladies and gents who write blogs at TPM or the WashingtonNote do depend on this important public good.

In the long run, the forces that lead the production of good, real news to decline will also cause the factual quality of blogging to decline.

This is not something that any of us should see as a matter for rejoicing.  I know that many TPM readers enjoy taking potshots at the "MSM".  An even an old curmudgeon like me will concede that the MSM deserves to be taken to task.

But we still need it.  A smarter, more accountable MSM would be better than the one we have.  But allowing the inexorable laws of economics to drive the MSM out of the marketplace will not lead us to some sort of editorial and reportorial Nirvana.

A world of Blogs without professional reportage would be an intellectually sterile place.

I urge all TPM readers to reflect seriously on Matt's underlying point.

John Stuart Blackton