The influence of media slant on short sellers

April Knill, Baixiao Liu, John J. McConnell and Glades McKenzie

Journal of Corporate Finance, 2024, vol. 84, issue C

Abstract: Using the positive shift in tone of Fox News coverage of macroeconomic news after the Republican Bush election in 2000, we investigate whether media slant influences the investment decisions of short sellers. We find that firms headquartered in Republican-leaning townships with Fox News availability experienced a relative decrease in short interest post the 2000 election. We further find that the relative decrease is more pronounced for firms that are more subject to investors' home bias. We interpret our findings to mean that short sellers, as sophisticated as they may be, are not immune to the slant in media coverage.

Keywords: Media slant; Short seller; Investment decisions (search for similar items in EconPapers)
JEL-codes: G11 G12 G14 G30 G32 G34 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:84:y:2024:i:c:s0929119924000038

DOI: 10.1016/j.jcorpfin.2024.102541

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