Yep, that one is quite obscure, have not been able to boil it down to one paragraph yet… and will not here either :)

(Once upon the time I touched upon the issue from an accounting point of view here: http://thingamy.typepad.com/sigs_blog/2005/02/gaaps_the_misle.html (suggesting that current accounting practices leads us astray… humbly of course :) )

But let me try:

First I group the following costs as “information costs” in practice: Advertising (of course), retail (to push something to touch and feel under my nose), inventories (to enable the stuff to be there to touch and feel), marketing mostly (as follows the above), much of management (not leadership as such, but the control and command and reporting bit – ususally a rather big part I suspect) and more if you give it a thought.

A. Then I sum up the costs of the above and deduct that from “what I pay”.

B. Or I could look to what the actual creator of the stuff I buy gets.

For books and music B is easiest – something like 10 – 20% of what I pay is for the actual product, rest is for “information”.

For most consumer goods I buy in shops I know that about half the price I pay is retailer margin, so I should be on the safe side there.

On the other extreme, like a car, I would do some rough calculations using A and perhaps find that about 60% of what I pay goes towards the physical object. Retailer margin + distributor + advertising + some more should add up to 40% + according to some backside-of-envelope calculations…

(Heh, every time I visit a showroom with marble floors and Gucci suits I know more about his poducts than the salesperson thanks to some evening use of internet. I would not miss that part at all!)

Of course extremely rough this, and with much arguments back and forth – but not too far from the truth I think – and it all adds up.

Now, information is the simplest thing to move, and the margins there are almost negligible – thus about half of what I spend can be replaced by cheap ICT (not in one go of course, but even nibbles of a big cake can amount to good servings).

And as money in the end equals resource-use, well, there might be an opportunity to halve the worlds resource-use if we shoot down some old truths :)