The Role of Media in Export Market Selection: Evidence From Chinese Firms

The media plays a significant role in shaping public opinion and consumer choices, sometimes inadvertently fueling suspicion of foreign companies among domestic consumers, which can impact foreign firms' export decisions. Utilizing the Global Database of Events, Language, and Tone (GDELT) data, we constructed a media inclination index based on global media praise and criticism. We examined how this media bias affected Chinese firms' export market selection behavior using data from 2000 to 2014 across 160 countries. Empirical analysis showed a significant correlation between positive media inclination in the export destination country and higher market entry rates for foreign exporters. This favorable media environment enhances local acceptance, reduces export challenges, increases profitability, and alleviates financing constraints for foreign firms. This effect is particularly pronounced for firms exporting consumer goods, engaged in general trade, and non‐foreign‐owned firms. Furthermore, media bias primarily influences export diversion in the initial exploration stage rather than persistent export behavior. These findings provide valuable insights for firms aiming to navigate global markets effectively.