The Journal of Economic History· 2026Q1
Information in the First Globalization: News Agencies and Trade
- 5citations
- Q1SCImago
- 2026year
Short summary
The emergence of global news agencies increased bilateral trade by 30% more than telegraph connections alone, by reducing information frictions.
AI-generated from the title and abstract; the full text is not read.
Key points
- Global news agencies improved information abundance, speed, and cost between countries.
- Bilateral trade increased by 30% more in countries covered by news agencies and telegraphs versus those with telegraphs alone.
- The study disentangles the impact of information improvement from reduced communication costs.
AI-generated from the title and abstract; the full text is not read.
Abstract
This paper documents the effect of information frictions on trade using a historical large-scale improvement in the transmission of news: the emergence of global news agencies. The information available to potential traders became more abundant, was delivered faster and at a cheaper price between countries covered by a news agency. By exploiting differences in the timing of telegraph openings and news agency coverage across pairs of countries, we are able to disentangle the pure effect of information from the effect of a reduction in communication costs. Panel gravity estimates reveal that bilateral trade increased by 30% more for pairs of countries covered by a news agency and connected by a telegraph than for pairs of countries simply connected by a telegraph.
The authors' abstract, as published at the source. The Journal of Economic History, 2026 · DOI ↗
Continue with a free account
Ask the paper: 3 free questions a day about this paper; save it, get its citation, new summaries every day for your field. Takeaways are Premium.
Continue free on the webSign in with Google or Apple; no card needed. You come back to this paper.
On your phone:
Field: General Economics, Econometrics and Finance
General Economics, Econometrics and FinanceEconomics, Econometrics and Finance