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Hotelling competition and political differentiation with more than two newspapers

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  • Behringer, Stefan
  • Filistrucchi, Lapo

Abstract

We analyse a market where newspaper publishers compete for advertising as well as for readership. Publishers first choose the political position of their newspaper then set cover prices and advertising tariffs. We build on the duopoly model of Gabszewicz et al. (2001, 2002) who show that advertising financing can lead to minimum political differentiation of the newspapers and hence a lack of plurality of political views or pensée unique. We extend their model to more than two newspapers and show that, contrary popular belief in competition policy, concern for such lack of plurality may diminish but does not disappear as the number of firms increases.

Suggested Citation

  • Behringer, Stefan & Filistrucchi, Lapo, 2015. "Hotelling competition and political differentiation with more than two newspapers," Information Economics and Policy, Elsevier, vol. 30(C), pages 36-49.
  • Handle: RePEc:eee:iepoli:v:30:y:2015:i:c:p:36-49
    DOI: 10.1016/j.infoecopol.2014.10.004
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    Cited by:

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    2. Jun Hu, 2021. "User-Generated Content, Social Media Bias and Slant Regulation," Working Papers hal-03120466, HAL.
    3. Han, Haipeng & Lien, Donald & Lien, Jaimie W. & Zheng, Jie, 2022. "Online or face-to-face? Competition among MOOC and regular education providers," International Review of Economics & Finance, Elsevier, vol. 80(C), pages 857-881.
    4. Huang, Yeu-Shiang & Ho, Jyh-Wen & Wu, Guan-Jin, 2022. "A study on promotion with strategic two-stage customized bundling," Journal of Retailing and Consumer Services, Elsevier, vol. 68(C).
    5. Kerkhof, Anna, 2019. "Advertising and Content Differentiation: Evidence from YouTube," VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy 204468, Verein für Socialpolitik / German Economic Association.
    6. Marco Antonielli & Lapo Filistrucchi, 2011. "Collusion and the political differentiation of newspapers," Working Papers 11-26, NET Institute, revised Nov 2011.
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    More about this item

    Keywords

    Media firms; Two sided markets; Hotelling oligopoly;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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