Public goods and welfare in the digital economy

In the digital economy, the notion of public good could be discussed and revisited to ensure welfare impacts are not missed from its classical definition.

I will focus my remarks on the case of JSTOR, where I will give a talk on Jan 16.

JSTOR doesn’t fit entirely the classical definition

In economics, a public good is defined by two main characteristics: non-excludability and non-rivalry: 1) Non-excludability: It is not feasible to exclude individuals from using the good. 2) Non-rivalry: This means that one person's use of the good does not diminish the ability of others to use it. While JSTOR provides a valuable resource, especially for students, researchers, and academics, its access limitations prevent it from being a public good in the standard definition. It's more accurately described as a toll good, which is non-rival but excludable.

So JSTOR is not a public good? Let’s discuss

However, it’s also hard to provide a public good matching such a strict definition when you’re a company and not the State and I don’t find it charitable enough to recognize the public-good efforts put by those companies and in particular those non-profit ones. They do need to survive and thus having some way to ethically monetize the access to public good seems reasonable to me.

Most of the time also, the toll is paid by the institution in which a scientist belongs rather than the researcher themselves. Key difference with arXiv is that JSTOR provides peer-reviewed published articles whereas the former provides only pre prints. Hence even if the set of articles in open access on JSTOR is smaller than for arXiv, its quality is higher. You will probably won’t access the latest publications on JSTOR because of publishers’ embargos but you can access the latest versions of the pre-prints on arXiv based on the researcher’s discretion to make it available through the platform. But you will access longer period on JSTOR of published versions, often in an open-access way.

Towards a more global definition of Public Goods for Digital Goods: Welfare Considerations

To define JSTOR as a public good in a charitable or broader sense, one could focus on its contribution to public knowledge and education, emphasizing its role in providing access to scholarly resources. This perspective emphasizes the social and educational value of JSTOR rather than strictly adhering to the economic definition of a public good. Here's how this can be conceptualized:

1. Educational and Scholarly Impact JSTOR significantly contributes to the global education and research community by offering access to a vast archive of academic journals, books, and primary sources. This resource enhances learning, teaching, and research, which are critical public services.

2. Open Access Content Highlighting the open access aspect of JSTOR, which allows free access to a portion of its content, supports the idea of it being a public good. This freely accessible content benefits anyone with internet access, contributing to the dissemination of knowledge.

3. Commitment to Accessibility and Preservation: JSTOR's efforts in preserving scholarly literature and making it accessible, especially content that might otherwise be difficult to obtain, align with the principles of serving the public interest.

4. Role in Democratizing Knowledge: By providing access to scholarly materials, JSTOR plays a role in democratizing knowledge, making it more accessible to a broader audience beyond the academic institutions that can afford subscriptions.

5. Non-Profit Status: As a non-profit organization, JSTOR’s mission is oriented towards serving the educational and scholarly community, which aligns with the broader interpretation of providing a public good.

6. Collaborative and Community Aspect: JSTOR, and similar platforms, often collaborate with libraries, educational institutions, and publishers. This collaborative model, which pools resources and efforts, can be seen as contributing to the public good by enhancing the accessibility and reach of scholarly materials.

7. Dynamic Access Models: Over time, JSTOR and similar platforms have been experimenting with different access models, including limited free access, reduced-cost subscriptions for certain regions or institutions, and other initiatives aimed at widening access. This adaptability in response to the needs of the global research community is another dimension of their contribution.

8. Digital Preservation: The role of JSTOR in preserving academic and scholarly content in digital formats ensures that this knowledge is safeguarded against physical degradation of original materials. This aspect of digital preservation contributes to the long-term availability of scholarly knowledge.

9. Support for Developing Regions: Some platforms, including JSTOR, have policies or programs aimed at increasing access in developing countries or under-resourced institutions. This helps in reducing the global knowledge divide.

10. Impact on Policy and Public Discourse: By providing access to a wealth of research, these platforms indirectly contribute to informed policy-making and public discourse, which is an essential aspect of a healthy, functioning society.

While this interpretation goes beyond the strict economic definition of a public good, it acknowledges JSTOR's substantial contribution to public welfare and education. This perspective is more about recognizing JSTOR's societal impacts.

Accounting for these benefits

One paper I read which could relate to some extent to our discussion here is this one: Brynjolfsson, Erik, Avinash Collis, and Felix Eggers. "Using massive online choice experiments to measure changes in well-being.".

This paper investigates the feasibility of utilizing massive online choice experiments to measure consumer surplus and changes in well-being. The authors illustrate this technique with several empirical examples that quantify the valuations and categories of popular digital goods. They discover that digital goods have resulted in substantial well-being increases not captured by conventional measures of GDP and productivity. In addition, the authors present a method for measuring consumer surplus with SBDC choice experiments and extend the experiment to include additional popular digital goods in Europe. Search engines were the most valuable category of digital products, followed by email and digital maps. The authors conclude that their method is highly scalable, relatively inexpensive, and provides a direct measurement method for a concept that other official data must accurately measure.