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The public sphere and the theory of public goods
Christian Steininger
1. Introduction
The relationship between the market and public sphere, as addressed by early
Zeitungswissenschaft (“Newspaper Studies”) and also implicitly taken up by Jochen Röpke,
highlights the need for a thorough examination of the theory of public goods in order to
heterodoxically arrive at a theoretical concept of the public sphere. Elaborating the work of
Mancur Olson in particular, on whose edifice of thought Röpke’s observations are largely
founded, shows that neither the concepts of media or public sphere have, to date, been
attributed to precise commodity segments. Yet it is precisely such a classification and
assignment of marketability which allows a debate to be conducted on the paradoxy of a
private (commercial), institutional and organizational form of public media.
The public sphere is a relatively recent concept in political and social thought. No European
language had an equivalent expression prior to the 18th century. This is of significance not
only to linguistic history but also to the subject matter itself (cf. Hölscher, 1997, p. 8).
According to Hölscher, the “public sphere” is one of those revolutionary concepts of the late
18th to early 19th century that the philosophy of enlightenment forged into political
propaganda weapons. “The public sphere is the social medium for the legitimation of political
authority and indeed — a modern-world trait that has emerged since the 18th century — for its
establishment in the first place.” (ibid, p. 7) In political and social discourse on enlightenment
the concept ultimately helped shape the social realities it was describing. Because of the
arbitrariness of the concepts used, there has been a tendency to be satisfied with simplicistic
answers. The public sphere thus remains a general ideal, on a par with publicity or the market,
whose definitions “remain vague in the ‘public opinion’ discourse.” (Hickethier, 2000, p.
4ff.).
It was Jürgen Habermas’s influential work The Structural Transformation of the Public
Sphere (1995) that finally established the notion of the public sphere as one of the
fundamental
concepts
of media and
communication science,
complementing its
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“incorporation in the terminological inventory of the social sciences.” (Gerhards, Neidhardt
and Rucht, 1998, p. 268) Like many other key terms it is vague, “has not yet been adequately
conceived” (Faulstich, 2000, p. 51) and has managed to successfully resist any universally
acceptable definition. Moreover, the term is also used in combination with attributives.
References are made to formalised, non-formalised, bourgeois, proletarian, plebeian,
constructed, active, passive, latent, modern, representative, sophisticated, democratic, liberal,
staged, mass media, symbolic, participatory, performative, classic, non-classic, organised,
non-organised, alternative, semantically active, domination reducing, oscillating, radically
bourgeois, post-bourgeois, feministic, simple, intermediate, complex, socialist, capitalistic,
new, journalistic, official, subversive, independent, indirect, direct, community, national,
transnational, integrated, fragmented, diversified, divided, differentiated and European public
spheres. This list is by no means exhaustive.
What most works on the public sphere have in common is the fact that they focus on these
attributes in their own right, and thus evade getting to grips with the public sphere itself. In
dividing up the compound expressions, most public sphere theories focus on correlations with
other concepts such as media, democracy, space, reality construction or systems. The
diffuseness referred to above is also reflected in the prevailing theories. Public sphere theories
are either superficially comprehensive, lacking any references to individual media, or merely
refer to them as “the media” in general, thus positioning the theories as transmedial “so that
they always address several media in the construction of a universally intended public
sphere.” (Hickethier, 2000, p. 9) Although individual media are referred to as public spaces,
this largely happens in the context of public activities or “public discourse”. Political opinion
formation is frequently uncritically ascribed an underlying public character. “A fully-fledged
theory of the various media forms that constitute the public sphere or the way in which these
individually characteristic media contribute towards a common public sphere does not exist.”
(ibid) Nevertheless, there are approximations to the subject which are separately set out and
categorised here according to their focus on specific explanatory aspects. Themes taken up
include: the media activation of the public sphere (Dahrendorf, 1974); its communication in
the media (Rust, 1977; Widmer, 1997); the media as a public sphere institution (Habermas
1985); the public sphere as discourse (Wessler, 1999); structure (Müller-Doohm, 1998;
Oevermann, 1996); communication (Baecker, 1996); and criticism of the acceptance of the
media-generated ideal public sphere (Demirović, 1994; Negt/Kluge, 1972, 1985; Nuissl,
1975).
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A closer look at these approaches reveals a common denominator, namely, an interest in the
economic conditions under which the media operate. However, when attempting to uncover
causal connections between economic conditions and media output none make a serious effort
to draw on media economics. Thus, in their understanding of media activation of the public
sphere Rust (1977) and Widmer (1997) merely stress the importance of economic interests in
general terms. Habermas (1985) describes the role of the media as institutions of the public
sphere in the context of commercialisation and the circulation of goods. Both Oevermann
(1996) and Müller-Doohm (1998) regard the structural interaction of the media and the public
sphere as determined by the profit motive of the culture industry. Negt and Kluge (1972;
1985), and Nuissl (1975) base their critique of the belief that the media constitute an idealtypical (bourgeois) public sphere on the relations of production.
Zeitungswissenschaft identified a unique dualism in the newspaper industry due to
advertising. “In one and the same paper, and often on the same page where the highest
interests of humanity are supposed to be represented, sellers and buyers go about their
business in the base pursuit of profit, and it is often hard for the uninitiated to make out where
the public interest ends and the private starts in the ‘advertising section’.” (Bücher, 1922, p.
258) It was Jochen Röpke (1970a; 1970b) who, without explicitly referring to any of the
classic works of economic theory, made a noteworthy — and still unjustly neglected —
attempt to link elements of economics and communication theory, and to apply them to the
question as to how far the workings of the market can create or sustain an open system of
communication serving the democratic ideal. In addressing this question, Röpke deals with
the public sphere, public opinion1, democracy, competition, the market, media innovation
strategies and the special nature of media products as economic goods. In discussing the latter
issue he distinguishes between collective goods (opinion forming content) and private goods
(selective incentives). Röpke was thus quick to apply Olson’s theory of public goods (1968)
to the media. With the aid of these analytical tools he succeeded in arriving at a fully fledged
theory of the various forms of media embodying the public sphere. Classifying media
products according to their character as economic goods, and hence their marketability allows
conclusions to be drawn about media content and its consequences for the creation of public
spheres. It enables communication theory to debate the paradox between the media’s private
(commercial) institutional and organisational form, and their public function. Declining
1
By öffentliche Meinung (public opinion) Röpke means media content that contributes to the formation of public
opinion, as opposed to the content that offers selective incentives. I have therefore translated the term as
“opinion forming media content” when used in this sense.
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average costs, zero marginal costs, production and consumption externalities, imperfect
markets, distorted preferences and the impossibility of enforcing the exclusion principle are
all flaws which — if economic theory is to be believed — result in partial or complete market
failure. For markets to function, property rights must be defined and enforced. For example,
they will only work properly if the exclusion principle is feasible, i.e. economic actors can be
excluded from using a good. Yet exclusion is scarcely central to the definitions of the public
sphere offered by communication theory, and payment of the price demanded by the owner is
not a necessary condition of access. It is precisely the fact that the media are public goods that
demonstrates the limits to the efficiency of these markets.
2. Media self-privatisation2
Röpke sees the role of the citizen as going beyond approving politicians’ decisions by
acclamation and funding the state, which merely represents a passive public sphere. An active
public sphere requires the involvement of citizens in the political opinion formation process.
According to Röpke this implies: “(1) ‘objective’ information on political, social and
economic developments; (2) public discussion of facts and opinions in the light of differing
standpoints (the process of public opinion formation); and (3) feedback from the opinions and
ideas of informed citizens to the political decision-making centres.” (Röpke, 1970a, p. 171)
Röpke regards the press as a forum for an active public sphere of this sort. (ibid, p. 172) He
understands public opinion as the state of opinion at a given point in time during an opinion
formation process. The latter is public (accessible to all), “because the debate is carried on in
the press and is ‘open’ in that the number of participants is in principle open, that is,
unlimited.” (ibid, p. 174) The product of this public debate is a public, not a private good.
While Röpke concedes that “depicting opinion forming content as a collective good may seem
at first sight to be no more than playing with words” (ibid), his central contribution was
precisely to have explicitly based his definition of collective goods on Olson’s theory.
However there are major obstacles to the ability of the commercial media to meet the above
preconditions for the existence of an active public sphere. It follows that Röpke sees the press
not just as a forum for the active public sphere but also as a commercial undertaking “that
sells both private goods (news, opinions, entertainment and advertising) and a public good,
namely, that good which, viewed statically, is the result of the opinion formation process that
The German term Selbstentöffentlichung used here literally means “self de-publicisation”. It conveys the
process by which the media voluntarily retreat from their function as public goods.
2
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takes place under conditions of press freedom.” (ibid, p. 175; cf. Röpke, 1970b, p. 103) Yet,
he argues, Habermas’ structural transformation of the public sphere is sufficient to show that
“the price of the maximisation of sales volume … tends to be depoliticisation of the content.”
(Röpke, 1970a, p. 181) This is although, like press freedom, the process of critical and
rational controversy in the press is institutionalised by the constitution. (ibid, p. 185) The fact
that everyone has this basic right, and no one can be excluded from exercising it, guarantees
the individual’s participation in the public opinion formation process. The economic cost of
the media is the cost of opinion forming content as an economic good. However, drawing
directly on Olson, who shows that large latent groups offer their members no incentive to act
collectively to provide a public good, we must follow Röpke in asking: “Can a collective
good be produced on a commercial basis, as would be the case with the commercial
organisation of the process of public opinion formation?” (ibid, p. 186) The answer is that
collective goods and the processes from which they derive cannot be optimally provided on
markets, which are driven by individual needs. This also applies to cases in which all the
members of the relevant group are in full agreement about the aim of producing opinion
forming content. (ibid, pp. 186 f.) Newspaper proprietors must offer consumers selective
incentives “that do not act indiscriminately on the entire group of citizens like a collective
good, but selectively on individuals or sub-groups (strata) within the overall group.” (ibid, p.
187) Röpke argues that the entrepreneur can obtain payment from the consumer by offering
selective incentives. It is evident that with increasing competitive intensity the ratio of
collective goods to selective incentives will decrease. If the amount of collective goods
provided is to remain unchanged then, in this case, the selective incentives offered will have
to be increased, such that opinion forming content will decrease as a proportion of the overall
product (ibid, p. 188).
The problem with a commercially organised press is that its production, which is steered
by the competitive process, tends to reduce the collective good as a proportion of the
overall product. The institutionalisation of an actual and potential discussion forum
becomes a by-product of an organisation primarily oriented towards satisfying
individual needs, that is, providing selective incentives. (Röpke, 1970a, p. 188)
The political public sphere thus disintegrates. Here, Röpke speaks of a “self-privatisation” of
the press impelled by commercialisation, which drives the privatisation of the audience (cf.
1970b, p. 112). He maintains that this situation is incompatible with the notion of a free
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market place of ideas. The offer of positive selective incentives by media companies does not
provide a way out of the “schizoid” role and functional structure. This would require negative
selective incentives, as only coercion would prevail upon individual members of the
community to act in the interests of the group. “In media policy terms, this implies that
measures aimed at promoting competition (merger control, the limitation of market shares,
circulation limits, the breaking up of monopolies, etc.) would not address the causes of the
phenomena they are intended to combat.” (Röpke, 1970a, p. 189) According to this reading
“manipulative tendencies” are caused not by the much deplored monopolisation of the media
but by “classic competition par excellence”, “combined with the effect of deculturised
selection mechanisms.” (Röpke, 1970b, p. 103) It follows that Röpke regards the award of
private radio and television licences as a “fundamental intrusion in the opinion formation
process" (ibid, p. 109).
It is striking that Röpke saw both the press and broadcasting as collective goods. He was well
aware that this was open to attack, but attempted to sidetrack the argument by suggesting that:
“One could maintain that the entire output of radio and television, and not merely the opinion
forming component, essentially constitutes collective goods, since there is no way of
preventing a viewer from watching a programme. The condition of non-excludability would
this be met by all broadcasts.” (ibid, p. 112) However, he noted, this could quickly be
changed, as the non-withholding of broadcasts from citizens was a side-effect of the basic
right of freedom of opinion and information, and was not inherent to nature of radio and
television themselves (ibid). This makes it clear that the characterisation of media as
economic goods requires further differentiation if the theoretical rigour of Röpke’s position is
to be maintained. We shall now turn to the author to whom Röpke largely owed it.
3. Collective goods and action
Within economics Olson advocates the abolition of the traditional division of micro and
macroeconomics, and outside of it he strives for an interdisciplinary approach to the analysis
of economic, social and political phenomena. “In both cases the argumentation on which his
efforts towards theoretical integration are based is the same: it centres on the — partly
unintended — effects of intentional actions.” (Pies, 1997, p. 2) In contrast to the exponents of
mainstream economics, Olson’s focus is not on markets, and hence it is not on the
7
decentralised provision of private goods. Olson is concerned with the collective provision of
public goods. As Pies aptly puts it, Olson sees “collective action as individual action in a
group”, (ibid, pp. 2 f.) and asks under what conditions rational actors will be prepared to
contribute to group interests. Olson argues that a society – "unter sonst gleichbleibenden
Umständen – mit größerer Wahrscheinlichkeit zusammenhält, wenn ihre Mitglieder so
sozialisiert sind, daß sie hinsichtlich kollektiver Güter ähnliche Bedürfnisse haben" (1991, p.
174). This is more than a mere rhetorical turn of phrase. According to Olson, debates on
social cohesion will completely miss the point unless a distinction is drawn between public
and private goods (ibid, p. 175) and this distinction is worked out in theoretical detail.
What can communication theory learn from the theory of economic goods about the public
sphere? In answer to this question let us examine Olson’s thoughts on social cohesion. Olson
distinguishes between collective and non-collective goods. He also uses public and private
goods synonymously with them, but states that these concepts are less precise. (ibid, p. 173)
"Wenn wir von einigen definitorischen Feinheiten absehen, läßt sich ein kollektives Gut
beschreiben als ein Gut, von dessen Konsum Nicht-Käufer nicht wirksam ausgeschlossen
werden können." (ibid) In the case of non-collective or private goods, consumption by nonpurchasers can certainly be prevented. "Es gibt, anders ausgedrückt, keinen gemeinsamen
oder gemeinschaftlichen Konsum eines nichtkollektiven Gutes." (ibid, p. 174) Olson sees the
cohesion of societies as connected with their members’ need for collective goods. Or to be
more precise, and to take into account the characteristics of non-collective goods that generate
cohesion:
[D]aß dort, wo Einzelpersonen etwas verbrauchen oder gebrauchen können, ohne
daß andere an diesem Konsum teilnehmen müssen, sie mehr Zusammenhalt zeigen
werden, wenn sie verschiedene Präferenzen und produktive Fähigkeiten haben,
weil dies die Gewinne aus den Tauschakten untereinander maximiert; wo
andererseits die einzelnen sich Ziele setzen, die, wenn sie für einige verwirklicht
werden, automatisch für andere verwirklicht sind, dort wird es umso einfacher
sein, sich auf eine gemeinsame Politik zu einigen, je ähnlicher die Präferenzen und
Situationen der einzelnen sind. (Olson, 1991, p. 174)
However this means that nothing has yet been gained, or least this is so if, like Olson, we
introduce the aspect of action. This is because:
8
Other things being equal, the larger the number of individuals or firms that would
benefit from a collective good, the smaller the share of the gains from action in the
group interest that will accrue to the individual or firm that undertakes the action.
Thus, in the absence of selective incentives, the incentive for group action
diminishes as group size increases, so that large groups are less able to act in
their common interest than small ones. (Olson, 1982, p. 31)
If, as Olson suggests, groups with access to selective incentives are more likely to be capable
of taking collective action to obtain collective goods, and small groups are more likely to be
able to take collective action than larger ones, then it is possible to understand why the masses
of consumers, media users, taxpayers, poor and unemployed are unorganised. The attainment
of a common goal or the satisfaction of a common need by a group results in the provision of
a collective good for that group. (cf. Olson, 1968, p. 14) According to Olson, the sanctions
and incentives must be of greater value in the eyes of the individual "als der individuelle
Anteil an den Kosten des Kollektivguts." (ibid, p. 50) It is not the readiness of the individual
to make a direct contribution to a public good, but the incentive to do so indirectly that
triggers collective action. (cf. Pies, 1997, p. 7) “This means that it is a matter of institutional
arrangements whether selective incentives will induce group members to act in the common
interest of the group.” (ibid)
In their discussion of Olson’s The Logic of Collective Action Homann and Suchanek (1992)
interpret the acceptance of moral norms as a public good3, and apply Olson’s observations on
the subject. Kirsch takes a similar approach in treating institutions, viewed as rules of
interpersonal behaviour, as collective goods, and drawing conclusions from this as to their
longevity and functioning. He argues that both formal and informal rules can only be
established under the conditions formulated by Olson. Kirsch also holds that: “Since
institutions, that is, rule systems, can only exist if they are accepted and acted upon, one must
take it that existing institutions can be disrupted or actually destroyed by the behaviour even
of those who have an interest in their continued existence.” (1997, p. 344)
Strictly speaking — but this only becomes clear below — it would be more accurate to speak of a
“collective good”, despite the fact that Olson uses public and collective goods synonymously. Homann
and Suchanek wrongly argue that: “The distinction between collective and public goods, which is
helpful in other contexts, is immaterial to the question dealt with here." (1992, p. 13)
3
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The applicability of Olson’s logic predicates the general acceptance of a social value system.
Economics normally presupposes adherence to such norms. These are the boundaries of
Olson’s theory, since particularly where “major changes in the value system arise from
collective learning processes” (Homann and Suchanek, 1992, p. 19), and this is a matter of the
birth of, or changes in an ideology, “Other explanations are required that no longer simply
apply The Logic of Collective Action.’” (ibid, p. 20) Here, account must also be taken of
categories such as legitimation and social communication. Röpke’s public opinion is thus not
alone in requiring (media) communication for its constitution due to its nature as a collective
good. Homann and Suchanek also rightly criticise the fact that for Olson insight is purely
destructive and instrumental in character, as exemplified by the “free rider” problem. They
note that overcoming the prisoner’s dilemma would be a constructive outcome — which
according to Olson could only by attained by “incentives offered by political entrepreneurs, as
it were, behind the backs of the actors, but not by reason or morality, etc.” (ibid) Yet social
problems call not just for individual but also for collective and social rationality. According to
Homann and Suchanek this implies public communication. “It thus becomes a matter of
communication about goals, values, preferences and interests, or in other words, the question
as to which values and interests are and are not accepted by society. And it is at root a matter
of interpretations of situations and of collective self-awareness. This implies reflection on
experience, that is, history.” (ibid)
What particularly commends Olson’s insights for inclusion in media economics is not merely
the degree to which he diverges from neoclassical economics but also the starting point that
he chooses, since this differs even from that of the economic classics which deal with
markets, i.e. the decentralised provision of private goods. Olson is concerned with
organisation, and his interest is in the individual’s access not to private but to public goods.
Olson regards collective action as individual action in a group. In this way insights are gained
from group theory that are of relevance to social theory (cf. Pies, 1997, pp. 2 f.) and reflect an
awareness that social science requires interdisciplinarity. While sociology stresses
homogeneity in the form of common values and norms as the precondition of social
integration, economics states the opposite: gains from trade arise where a population is
heterogeneous. Olson uses the distinction between private and collective goods (ibid, p. 23) to
overcome this contradiction. He is far from being an “economic imperialist”, and neither does
he resort to adding assumptions to maintain the integrity of his model. He does not use the
existence of individual choices as a justification for applying the theory to non-economic
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areas of life. And his theory does not imply that market failure is the only relevant
justification for the acceptance of non-market forms of coordination. (cf. Kirsch, 1997, pp. 31
ff.)
4. The media and the public sphere
What economic goods are required to provide a public sphere? And what kinds of goods are
the public sphere and the media? A wide variety of answers have been given to these
questions. For instance Zeitungswissenschaft, which was still strongly influenced by
economics, treated the media as symbolic goods for the purpose of trade and general
communication. (cf. Groth, 1948, p. 260) Röpke describes both opinion forming content, and
the press and broadcasting media as collective goods. He regards the public sphere itself as a
by-product of the media. For his part Olson does not comment on the public sphere, and sees
defence, police protection and the system of law and order as collective goods. Homann and
Suchanek view the acceptance of moral norms as a public good. A closer examination of the
theory of economic goods is thus required to answer the above questions.
A good starting point for an assessment of the extent to which the media conform to the
characteristics of collective goods is the careful and detailed review of existing insights by
Münch (1976). This study provides a satisfactory account of terms such as “collective” and
“public” goods which are often used coterminously, and provides a typology of the media that
enables them to be systematically discussed as public goods. He argues that the main criteria
for classing goods as collective “do not rest on inherent market failure, which makes such
goods into public goods, but have to do with a characteristic of these goods themselves, which
is entirely independent of the degree of perfection of the market in question.” (ibid: 40)
Hence, Münch does not accept the drawbacks of goods or products as a measure of market
imperfection.
The nature of the media as economic goods has already been addressed in the literature. If one
follows the economic theory of goods, then only the broadcasting media, which are wireless
and are distributed in an undistorted manner, are pure public goods. Both content and carrier
medium fully meet the conditions of non-excludability and non-rival consumption. As public
goods, the media exhibit externalities, are complex experience or credence goods, and can be
11
regarded as joint products from three perspectives: (a) as a combination of editorial and
advertising sections; (b) as a combination of public (often meritorious) goods with selective
incentives distinguished by their private character; and (c) as a combination of intangible
content with tangible carriers. (cf. Kiefer, 2001, pp. 156f.)
Heinrich (2005, p. 327) takes a similar view, treating the information inputs to the opinion
formation process as a public good, and seeing “the collectively organised financing and
provision of such goods, which are generally referred to as pluralism, the watchdog function
of the media, cultural integration, etc.” (ibid, p. 326) as justified by the existence of public
goods. Kiefer’s contention that media content constitutes public goods accords with Röpke’s
conviction that opinion forming content is a collective good. Here, then, a collective good
depends heavily on a public good typified by problems related to market failure, affecting
both the content and the carrier medium. As Olson’s group theory shows, the provision of
collective goods is no easy matter. An additional difficulty is presented by the fact that in
most sectors of society the production of collective goods does not take place in independence
of the media, and that the latter are compelled by their nature as providers of public goods to
adopt production strategies that are increasingly geared towards selective incentives
(stereotypes and formulas). The differing degrees to which the media are public goods have
consequences for the content, since the media have an inherent tendency to strive towards
excludability. Röpke would probably regard this as a process of media self-privatisation. This
has wider implications than merely the various types of goods. The theory of economic goods
clarifies both the various gradations of the public sphere and collectivity, and also their
relationship with the inherent characteristics of media as goods and the related privatisation of
the receiver.
5. Conclusions
If the media do not simply mirror social processes, but interpret, construct and mould them,
then they have a central role in the constitution of collective goods, and interest will
inevitably focus on their institutional and organisational forms (public or commercial). The
latter shape the social space, and the forms of capital at work in it. Public spheres play a
central role in the construction of collective social perceptions. They act as spaces for the
regulation of depictions of reality in the sense of a reduction of political, economic, cultural
12
and symbolic complexity. Social constructs of reality are consolidated, rules and norms of
social life implemented, and cultural identities created in them. Public spheres can thus be
seen as collective reality constructs shared by one or more social fields. Through their
inherent characteristics, the various media influence the mobility and openness to change of
the public spheres constituted by them. This makes Röpke’s conclusion that the public sphere
is becoming a by-product of media enterprises that produce selective incentives particularly
worthy of notice. (cf. 1970a, p. 188)
Linking approaches drawn from communication theory and economics can, then, make an
indispensable contribution to the debate on the public sphere. Röpke’s work stands out for its
emphasis on normative analysis. Olson’s theories are also an ideal starting point for the
development of a normative concept of the public sphere, and for the analysis and explanation
of a media structure characterised by duality, and constantly caught between the twin poles of
market failure and state invention. It is here that the discussion of the special character of the
media as economic goods shows its true definitory, analytical and explanatory value. In
contrast to Röpke, a distinction is drawn between public and collective goods.4 Media content
does not constitute collective goods as Röpke supposes. Collective goods require different
forms of “production” to public or private goods. It is not markets that provide collective
goods but groups or organisations, and their production thus requires not market but collective
forms of provision (collective action). The media are public goods on which the production of
collective goods depends. The greater the complexity of collective goods, the more will they
depend upon outside factors — including interaction with other collective goods such as
moral norms. To sum up, anyone who attaches importance to the production of collective
goods must take into account the degree to which the goods required for their constitution are
public, and must be aware of the paradox between the private (commercial) institutional and
organisational form of the media and their public function. In the context of social interaction,
the impacts of media content undoubtedly create collective goods and collective “bads”.
4
Collective goods should be referred to as commons, so as to avoid misunderstandings, given that in
large parts of the literature the term is used synonymously with public goods.
13
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