Purpose Knowledge organization (KO) is essential infrastructure for document search and discovery, yet institutional investment in cataloging, indexing and metadata infrastructures continues to decline. This paper aims to develop an integrated economic framework for explaining chronic underinvestment in KO. Design/methodology/approach Drawing on information economics, KO outputs are conceptualized as information goods with high fixed costs, non-rivalry, network externalities, option value and weak appropriability. The paper analyzes how these characteristics shape incentives across provision models and illustrates the argument through institutional analysis of library and information services in Japan. Findings KO is subject to two distinct but interacting forms of undersupply. General-purpose KO exhibits quasi-public-good properties that generate free riding and appropriability failure. Domain-specific KO is constrained by market size: even when willingness to pay exists, small user populations cannot sustain the high fixed costs required for professional provision. These mechanisms interact dynamically, producing a disinvestment scissors effect in which the social marginal value of KO rises while institutional investment declines. Research limitations/implications This conceptual analysis does not estimate externalities or investment trajectories; future research should measure KO-related externalities across domains, particularly intergenerational externalities, and compare institutional arrangements. Originality/value Rather than advocating KO as intrinsically valuable, the paper offers a mechanism-based explanation of why KO is systematically underprovided despite its growing societal dependence. It integrates previously disconnected economic perspectives into a unified framework.
Ryo Shiozaki (Thu,) studied this question.