Is Online News an Inferior Good? Examining the Economic Nature of Online News among Users

Abstract

The U.S. newspaper industry is transitioning from print to online, but users' response to online news has fallen short of expectations and thus raised questions about the economic viability of the new medium. This study explores the economic concept of “inferior goods” and its applicability to online news consumption. Analysis of Pew Research Center survey data shows that as income increases, consumption of online news decreases, other things being equal. Therefore, online news is an inferior good among users.