A comparison and critical assessment of Porat and Rubin's information economy and Wallis and North's transaction sector

This paper compares two approaches to the measurement of the resources devoted to the organisational task in the economy, i.e. Porat and Rubin's `information economy' and Wallis and North's `transaction sector'. While there have been a number of studies using the information economy approach, it seems to have made way to a narrower focus on the information technology economy in recent years. The quantitative measurement of the transaction sector, on the other hand, again focuses on the wider issues involved in information activities, e.g. organisational and institutional questions. However, it is only in its infancy. Being based on a well-known theory, i.e. transaction cost economics, it might attract attention from a larger number of economists than does the information economy approach. The paper points out similarities and shortcomings of both approaches and indicates areas for further research. ©1997 Elsevier Science B.V.