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Mark my words: the transmission of central bank communication to the general public via the print media

Tim Munday () and James Brookes ()
Additional contact information
Tim Munday: University of Oxford
James Brookes: Bank of England, Postal: Bank of England, Threadneedle Street, London, EC2R 8AH

No 944, Bank of England working papers from Bank of England

Abstract: We ask how central banks can change their communication in order to receive greater newspaper coverage. We write down a model of news production and consumption in which news generation is endogenous because the central bank must draft its communication in such a way that newspapers choose to report it, while still retaining the message the central bank wishes to convey to the public. We use our model to show that standard econometric techniques that correlate central bank text with measures of news coverage in order to determine what causes central bank communication to be reported on will likely prove to be biased. We use techniques from computational linguistics combined with an event-study methodology to measure the extent of news coverage a central bank communication receives, and the textual features that might cause a communication to be more (or less) likely to be considered newsworthy. We consider the case of the Bank of England, and estimate the relationship between news coverage and central bank communication implied by our model. We find that the interaction between the state of the economy and the way in which the Bank of England writes its communication is important for determining news coverage. We provide concrete suggestions for ways in which central bank communication can increase its news coverage by improving readability in line with our results.

Keywords: Central bank communication; print media; high-dimensional estimation; natural language processing (search for similar items in EconPapers)
JEL-codes: C01 C55 C82 E43 E52 E58 (search for similar items in EconPapers)
Pages: 92 pages
Date: 2021-10-27
New Economics Papers: this item is included in nep-ban, nep-big, nep-cba, nep-mac, nep-mon and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:boe:boeewp:0944

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