George, that’s an excellent point. In his 1945 essay “The Use of Knowledge in Society,” published in Individualism and Economic Order (Univ. of Chicago, 1948), Hayek wrote:
We must look at the price system as such a mechanism for communicating information if we want to understand its real function. . . . The most significant fact about this system is the economy of knowledge with which it operates, or how little the individual participants need to know in order to be able to take the right action.
I like how Prof. Richard Ebeling puts it in his May 1999 article in The Freeman, “Features: Friedrich A. Hayek: A Centenary Appreciation”:
In this work [Individualism and Economic Order (1948)] Hayek emphasized that the division of labor has a counterpart: the division of knowledge. Each individual comes to possess specialized and local knowledge in his corner of the division of labor that he alone may fully understand and appreciate how to use. Yet if all of these bits of specialized knowledge are to serve everyone in society, some method must exist to coordinate the activities of all these interdependent participants in the market.
With regard to news reporting, the Internet is that tool that allows this coordination to take place so that that unique, specialized and local knowledge can serve everyone in society. And it has indeed obsoleted the “central planning” model of the old media.
