Craigslist Saved Consumers a Lot of Money While Crippling Newspapers

Craigslist, the online-ad site, saved the placers of classified advertisements $5 billion from 2000 through 2007, according to an analysis by Robert Seamans of New York University and Feng Zhu of Harvard Business School. It also had a profound impact on U.S. local newspapers, siphoning off classified advertisers and leading to decreased classified-ad rates, increased subscription prices, reduced circulation, and declines in display advertising. It also set up a consumer expectation that classified advertising would be free.