Media Bias and Reputation

Abstract

A Bayesian consumer who is uncertain about the quality of an information source will infer that the source is of higher quality when its reports conform to the consumer's prior expectations. We use this fact to build a model of media bias in which firms slant their reports toward the prior beliefs of their customers in order to build a reputation for quality. Bias emerges in our model even though it can make all market participants worse off. The model predicts that bias will be less severe when consumers receive independent evidence on the true state of the world, and that competition between independently owned news outlets can reduce bias. We present a variety of empirical evidence consistent with these predictions.

Citizen-editors' endogenous information acquisition and news accuracy

“…Hence, she always prefers to watch a media outlet having a moderate editor since such an editor is the one whose news reports are, in expectation, most accurate (see Corollary 1). 27 On the other hand, for example, a moderateleftist citizen cares more about not making the error of choosing R when s = l. As shown by Corollary 1, a leftist editor has a lower probability of making such error but a higher probability of making a report in favor of L when s = r and a higher overall probability of making errors. Accordingly, a leftist citizen will then prefer a leftist editor to a moderate one.…”

“…That is, the above lemma provides a rationale for the presence of a demand for news coming from ideological editors. In particular, while an economic rational for the demand for liked-minded news is already present in other models of 27 Therefore, as a side result, the model also provides a rationale for why citizens with non-ideological preferences over candidates (i.e., moderate citizens) also prefer to watch news coming from a like-minded editor (i.e., a moderate editor). The following section analyzes the implications of such demand for news for the optimal choice of editors by profit maximizing media outlets.…”

Bayesian persuasion with heterogeneous priors

“…Moreover, both likelihood ratios (r R θ and λ R z ) are positively related, in the sense that realizations that come more as a surprise to the receiver than to the sender are associated with states that the receiver perceives as less likely. 16 As a final remark, note that the likelihood ratio r R is the Radon-Nikodym derivative of p R with respect to p S . Therefore, (6) states that Bayesian updating under a commonly understood experiment simply induces a linear scaling of the Radon-Nikodym derivative, where the proportionality factor does not depend on the experiment π.…”

“…Since the bureaucrat wants to maximize his career perspectives, he will exert more effort only if he thinks that the new project is 1 Many papers study the role of heterogeneous priors in economics and politics. Giat et al (2010) use data on pharmaceutical projects to study R&D under heterogeneous priors; Patton and Timmermann (2010) find empirical evidence that heterogeneity in prior beliefs is an important factor explaining the cross-sectional dispersion in forecasts of GDP growth and inflation; Gentzkow and Shapiro (2006) study the effects of prior beliefs on media bias. more beneficial than other existing projects to his agency's own goals.…”

The Development of "Immigration to Europe" Topic in the Time History of Speech Pattern Changes on the TV News

“…If to judge by these data, then the called information sources could convince from 8 to 10% of spectator audience. The author of the book Alexey Zubok gives also the conclusions drawn by researchers, -there is a tendency of the choice by the audience of the most qualitative information sources, and, as a rule, and these sources profess the same views, as they do (Gentzhkow & Shapiro, 2005).…”