News Aggregators and Competition among Newspapers on the Internet

Doh-Shin Jeon and Nikrooz Nasr

American Economic Journal: Microeconomics, 2016, vol. 8, issue 4, 91-114

Abstract: This paper studies how news aggregators affect the quality choices of newspapers competing on the Internet. To provide a micro-foundation for the role of the aggregator, we build a model of multiple issues where newspapers choose their quality on each issue. Our model captures well the main trade-off between the "business-stealing" effect and the "readership-expansion" effect. We find that the aggregator increases the quality only if the readership-expansion effect is large enough relative to the business-stealing effect. Using a condition obtained from empirical results, we find that the aggregator increases the quality and social welfare, but affects newspapers' profits ambiguously.

JEL-codes: D21 D22 L13 L82 (search for similar items in EconPapers)
Date: 2016
Note: DOI: 10.1257/mic.20140151
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Citations: View citations in EconPapers (21)

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Related works:
Working Paper: News Aggregators and Competition Among Newspapers in the Internet (2014)
Working Paper: News Aggregators and Competition Among Newspapers on the Internet (2014)
Working Paper: News Aggregators and Competition Among Newspapers in the Internet (2012)
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