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Time Scarcity and the Market for News

Larbi Alaoui and Fabrizio Germano ()
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Larbi Alaoui: UPF - Universitat Pompeu Fabra [Barcelona]

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Abstract: We develop a theory of news coverage in environments of information abundance that include both new and traditional news media, from online and print newspapers to radio and television. News consumers are time-constrained and browse through news items that are available across competing outlets, choosing which outlets to access and which stories to read or skip. Media firms are aware of consumers' preferences and constraints, and decide on rankings of news items that maximize their profits. We find that the news consumed in equilibrium is highly sensitive to the details of the environment. We show that even when readers and outlets are rational and unbiased, readers may consume more than they would like to, and the news items they consume may be significantly different from the ones they prefer. Important news items may be crowded out. Next, we derive implications on diverse aspects of current media, including a rationale for tabloid news, a rationale for why readers prefer like-minded news, and how advertising can contribute to crowding out news. We also analyze methods for restoring reader-efficient standards and discuss the political economy implications of the theory.

Keywords: digital media; news markets; time constrained consumers; news coverage; public media (search for similar items in EconPapers)
Date: 2015-12
New Economics Papers: this item is included in nep-com, nep-cul and nep-mic
Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01251522
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Related works:
Journal Article: Time scarcity and the market for news (2020) Downloads
Working Paper: Time scarcity and the market for news (2019) Downloads
Working Paper: Time Scarcity and the Market for News (2015) Downloads
Working Paper: Time Scarcity and the Market for News (2014) Downloads
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