Information good in economics and law is a type commodity whose main market value derive from information it contains. It may also include services (information services). The typical examples of information goods include a CD containing pieces of music, a DVD containing a movie, a computer file which is a piece of program, a book containing short stories, and so on.
In information goods, the valuable part is a pattern in which the material is arranged - the arrangement of ink on paper, paint on canvas, magnetic elements on a tape, a series of dents (pits) on a compact disc, etc. Those patterns might be either directly consumed by humans (through reading, viewing, etc.) or may be used to operate other devices such as a cassette player or a computer. The working of device, in turn, may produce some consumable pattern of information (such as visual, sound, or text), another pattern for the use of other devices, or both.
Information goods are often contrasted with material goods such as cloths, food, and cars. The market values of these goods typically rely on both the nature of material and its arrangements. When a car is made of wood instead of metals, for example, the market value of the car would very limited.
| Table of contents |
|
|
Some information goods, such as novel, movie, and newspaper are said to have a peculiar property. Before the consumption of the goods, a consumer may not be able to assess the utility of the goods very accurately and reliably. The process of evaluating utility indeed may be the very process of consumption.
This uncertainty of utilities is considered a source of market failure by many.
Advertisements, brands, third-party reviews and other secondary sources of information may play a bigger role in determining the demand curve, possibly resulting in a sub-optimal equibuillium of supply and demand.
Some information goods can be reproduced and distributed relatively inexpensively. Copying recorded music from radio, cassette player, CD player, etc. to a tape or computer hard disc is, for example, widely-practiced in many societies.
What is more, information goods are not consumed by the act of copying. On this basis, some argue that information (but not necessarily information goods) should be provided without cost and limitations to copying.
Some information goods can be reproduced and distributed relatively inexpensively. Copying recorded music from radio, cassette player, CD player, etc. to a tape or computer hard disc is, for example, widely-practiced in many societies.
As digital technologies and digital electronic network in some countries became very popular, it became very easy to reproduce and widely distribute some information goods. However, due to the difficulty of control on copying and distributing activities of individuals using such technologies, it is often harder for the producer of such good to prevent proprietary works to be illegally distributed.
see also: file sharing public good copyright Digital Millennium Copyright ActInformation goods and market failure
Information goods and uncertainty
Information goods and scarcity
Information goods and excludability
