Economics of blogging about economics

Putting together my first post made me think about the economics of blogging. Blogging is a tournament game: low barriers to entry, with a very few earning fame and fortune. In that respect, it is similar to dealing drugs (see Freakonomics).

For most bloggers, the return is low. If someone is blogging about economics, and doing a credible job of it, s/he presumably has marketable skills. Banks, universities, ministries, think-tanks — there’s a long list of potential employers. Why bother producing a blog?

Three reasons came to mind:

  • Weak altruism. Working on the NZAE Council, I see how much other people have contributed over the years. Now, through blogging, I can help improve the visibility and relevance of the Association. If economics looks relevant, then I look relevant, too.
  • Consumption good. Although I’m producing something, the real reason for writing a blog is the enjoyment of production. That makes blogging like playing music, knitting, and baking biscuits. Sure, we can argue about the relative quality of home-made versus store-bought, but in the end it’s about the pleasure of producing it yourself. It just so happens that I enjoy producing economic arguments.
  • Signalling. Well-known economics blogs tend to be side-lines. Why are otherwise successful people blogging, and why aren’t more economics bloggers famous in their own right? This looks like signalling in two parts. First, I’m not going to trust Billy Bob’s Forum of Economics and Used Hardware (no link). The fact that someone has a day job (in economics) signals trustworthiness. Secondly, getting involved with blogging signals with-it-ness. I can grok the new media, man. That makes me more in demand for my day job.

So blogging is like the rest of the economy: I am sending signals in order to improve my individual outcome, while contributing to my own tribe (but not too much) and taking pleasure from it.

Here’s to a new and strong signal from NZAE. We’ll enjoy the DIY, and we’ll try to keep the noise down.

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