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Mass Media and Special Interest Groups

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  • Maria Petrova

    () (New Economic School)

Abstract

Media revenues are an important determinant of media behavior. News coverage depends not only on the preferences of media consumers but also on the preferences of advertisers or subsidizing groups. We present a theoretical model of the interaction between special interest groups and media outlets in which the media face a trade-off between a larger audience and lower payments from special interest groups versus a smaller audience and more biased content. We focus on the relationship between the costs of production of media product and the level of distortion in news coverage that can be introduced by interest groups. Speciically, we look at the effect of falling marginal costs or the growing reliance on advertising revenues. We show that if people do not want to tolerate bias, or if special interest groups have budget constraint, then this effect is negative. If people do not pay attention to bias, or if the size of the audience is very important for the interest group, then this effect becomes positive. If markets are fully covered, and all consumers buy one unit of media product, then the effect disappears.

Suggested Citation

  • Maria Petrova, 2010. "Mass Media and Special Interest Groups," Working Papers w0144, Center for Economic and Financial Research (CEFIR).
  • Handle: RePEc:cfr:cefirw:w0144
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    Cited by:

    1. repec:cup:apsrev:v:105:y:2011:i:04:p:790-808_00 is not listed on IDEAS
    2. Larbi Alaoui & Fabrizio Germano, 2012. "Time scarcity and the market for news," Economics Working Papers 1348, Department of Economics and Business, Universitat Pompeu Fabra, revised Sep 2014.
    3. Wayne R. Dunham, 2013. "Framing the Right Suspects: Measuring Media Bias," Journal of Media Economics, Taylor & Francis Journals, vol. 26(3), pages 122-147, September.
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    13. Francesco Sobbrio, 2012. "A Citizen-Editors Model of News Media," RSCAS Working Papers 2012/61, European University Institute.
    14. Inés Moreno de Barreda & Gilat Levy & Ronny Razin, 2017. "Persuasion with Correlation Neglect: Media Power via Correlation of News Content," Economics Series Working Papers 836, University of Oxford, Department of Economics.
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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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