How big is the media multiplier? Evidence from dyadic news data

Timothy Besley, Thiemo Fetzer and Hannes Mueller

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: This paper estimates the size of the media multiplier, an easily generalizable model-based measure of how far media coverage magnifies the economic response to shocks. We combine monthly aggregated and anonymized credit card activity data from 114 card issuing countries in 5 destination countries with a large corpus of news coverage in issuing countries reporting on violent events in the destinations. To define and quantify the media multiplier we estimate a model in which latent beliefs, shaped by either events or news coverage, drive card activity. According to the model, media coverage can more than triple the economic impact of an event. We document, through our model, that this effect is highly heterogenous and depends on the broader media representation of countries in each others news. We speculate about the role of the media in driving international travel patterns an.

Keywords: media; economic behavior; new shocks; 101042703; International Growth Centre (search for similar items in EconPapers)
JEL-codes: D80 F10 F50 L80 O10 (search for similar items in EconPapers)
Date: 2024-02-09
New Economics Papers: this item is included in nep-big
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Citations: View citations in EconPapers (1)

Published in Review of Economics and Statistics, 9, February, 2024. ISSN: 0034-6535

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http://eprints.lse.ac.uk/120778/ Open access version. (application/pdf)

Related works:
Working Paper: How Big Is the Media Multiplier? Evidence from Dyadic News Data (2023)
Working Paper: How Big is the Media Multiplier? Evidence from Dyadic News Data (2023)
Working Paper: How Big is the Media Multiplier? Evidence from Dyadic News Data (2023)
Working Paper: How Big is the Media Multiplier? Evidence from Dyadic News Data (2023)
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