Competition and Ideological Diversity: Historical Evidence from US Newspapers

  • Matthew Gentzkow
    University of Chicago Booth School of Business, 5807 S. Woodlawn Avenue, Chicago, IL 60637, and NBER (e-mail: )
  • Jesse M. Shapiro
    University of Chicago Booth School of Business, 5807 S. Woodlawn Avenue, Chicago, IL 60637, and NBER (e-mail: )
  • Michael Sinkinson
    Wharton School, University of Pennsylvania, 3620 Locust Walk, Philadelphia, PA 19104 (e-mail: ).

書誌事項

公開日
2014-10-01
DOI
  • 10.1257/aer.104.10.3073
公開者
American Economic Association

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説明

<jats:p> We study the competitive forces which shaped ideological diversity in the US press in the early twentieth century. We find that households preferred like-minded news and that newspapers used their political orientation to differentiate from competitors. We formulate a model of newspaper demand, entry, and political affiliation choice in which newspapers compete for both readers and advertisers. We use a combination of estimation and calibration to identify the model's parameters from novel data on newspaper circulation, costs, and revenues. The estimated model implies that competition enhances ideological diversity, that the market undersupplies diversity, and that optimal competition policy requires accounting for the two-sidedness of the news market. (JEL D72, K21, L13, L41, L82, N42, N72) </jats:p>

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