organizing the media as a government owned monopoly can be made. Indeed, these arguments were adduced by the management of the newly formed British Broadcasting Corporation (BBC)in support of maintaining a publicly subsidized monopoly on radio and television in Britain( Coase 1950), and subsequently repeated in many developing countries In the case of the media industry, one additional argument animates the advocates of public ownership, namely consumer ignorance. In the extreme form, this argument holds that private owners use the media to serve the governing classes ( Lenin 1925). In the more subtle versie argued for many years by the BBC, state ownership protects the public from exposure to"extreme views. In modern versions, state ownership of at least some media is supposed to expose the oublic to information, such as culture, which might not be otherwise provided by privately owned firms. This"Sesame Street" argument, in addition to the standard industrial organization ones mediates in favor of state ownership of the media in the minds of many observers In contrast, those who believe in less than fully benevolent government are led to a different conclusion. In their view, a government monopoly in the media would distort and manipulate information to entrench the incumbent government, preclude voters and consumers from making informed decisions, and ultimately undermine both democracy and markets. Because private and independent media supply alternative views to the public, they enable voters and consumers to choose among political candidates, commodities, and securities-with less fear of abuse by unscrupulous politicians, producers, and promoters(Sen 1984, 1999, Besley and Burgess 2000). Moreover, competition among media firms assures that voters and consumers obtain, on average, unbiased and accurate information. The role of such private and competitive media is held to be so important for the checks-and-balances system of modern democracy, that they have come to be called"the fourth estate. " A cynical view of a government's motives thus leads to a2 organizing the media as a government owned monopoly can be made. Indeed, these arguments were adduced by the management of the newly formed British Broadcasting Corporation (BBC) in support of maintaining a publicly subsidized monopoly on radio and television in Britain (Coase 1950), and subsequently repeated in many developing countries. In the case of the media industry, one additional argument animates the advocates of public ownership, namely consumer ignorance. In the extreme form, this argument holds that private owners use the media to serve the governing classes (Lenin 1925). In the more subtle version, argued for many years by the BBC, state ownership protects the public from exposure to “extreme” views. In modern versions, state ownership of at least some media is supposed to expose the public to information, such as culture, which might not be otherwise provided by privately owned firms. This “Sesame Street” argument, in addition to the standard industrial organization ones, mediates in favor of state ownership of the media in the minds of many observers. In contrast, those who believe in less than fully benevolent government are led to a different conclusion. In their view, a government monopoly in the media would distort and manipulate information to entrench the incumbent government, preclude voters and consumers from making informed decisions, and ultimately undermine both democracy and markets. Because private and independent media supply alternative views to the public, they enable voters and consumers to choose among political candidates, commodities, and securities – with less fear of abuse by unscrupulous politicians, producers, and promoters (Sen 1984, 1999, Besley and Burgess 2000). Moreover, competition among media firms assures that voters and consumers obtain, on average, unbiased and accurate information. The role of such private and competitive media is held to be so important for the checks-and-balances system of modern democracy, that they have come to be called “the fourth estate.” A cynical view of a government’s motives thus leads to a