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The Effects of Media Slant on Firm Behavior

Vishal P. Baloria () and Jonas Heese ()
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Vishal P. Baloria: Boston College
Jonas Heese: Harvard Business School, Accounting and Management Unit

No 18-015, Harvard Business School Working Papers from Harvard Business School

Abstract: The media can impose reputational costs on firms because of its important role as an information intermediary and its ability to negatively slant coverage. We exploit a quasi-natural experiment that holds constant the information event across firms, but varies the availability of a major news outlet in local markets. We find that firms subject to the threat of slanted coverage suppress the release of negative information before the event and release it subsequently. Our results are consistent with theory on the active role firms can play in managing their reputational capital through anticipatory actions to avoid negative media coverage.

Keywords: media slant; reputational capital; strategic corporate decisions (search for similar items in EconPapers)
JEL-codes: D72 G30 G34 (search for similar items in EconPapers)
Pages: 54 pages
Date: 2017-08
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