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Advertising Spending and Media Bias: : Evidence from News Coverage of Car Safety Recalls

Authors: Graham Beattie,

Ruben Durante, Brian Knight, Ananya SenAuthors Info & Claims

Management Science, Volume 67, Issue 2

Pages 698 - 719

https://doi.org/10.1287/mnsc.2019.3567

Published: 01 February 2021 Publication History

Abstract

Do mass media bias content in favor of advertisers? If so, what market conditions limit or exacerbate this bias? We examine the relationship between advertising by auto manufacturers in U.S. newspapers and news coverage of car safety recalls between 2000 and 2014. This context allows us to separate the influence of advertisers, who prefer less coverage, from that of readers, who prefer more information about the safety risks associated with the recalls. Consistent with theoretical predictions, we find that newspapers provide less coverage of recalls issued by manufacturers that advertised more regularly on their pages over the previous two years. The effect is especially pronounced for more severe recalls, which are more likely to hurt manufacturers’ reputations. Competition for readers from other newspapers mitigates proadvertiser bias, and competition for advertising by online platforms exacerbates it. We also present suggestive evidence that less news coverage of recalls is associated with more fatal car accidents.

This paper was accepted by Joshua Gans, business strategy.

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Cited By

Dewan YSimons TWernicke G(2024)The Ideological ImperativeOrganization Science10.1287/orsc.2022.1723735:5(1930-1955)Online publication date: 1-Sep-2024
https://dl.acm.org/doi/10.1287/orsc.2022.17237
Sen AGrad TFerreira PClaussen J(2024)(How) Does User-Generated Content Impact Content Generated by Professionals? Evidence from Local NewsManagement Science10.1287/mnsc.2023.496270:9(6045-6068)Online publication date: 1-Sep-2024
https://dl.acm.org/doi/10.1287/mnsc.2023.4962

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Information & Contributors

Information

Published In

cover image Management Science

Management Science Volume 67, Issue 2

February 2021

670 pages

ISSN:0025-1909

DOI:10.1287/mnsc.2021.67.issue-2

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Copyright © 2020, INFORMS.

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INFORMS

Linthicum, MD, United States

Publication History

Published: 01 February 2021

Accepted: 18 October 2019

Received: 20 January 2019

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Cited By

Dewan YSimons TWernicke G(2024)The Ideological ImperativeOrganization Science10.1287/orsc.2022.1723735:5(1930-1955)Online publication date: 1-Sep-2024
https://dl.acm.org/doi/10.1287/orsc.2022.17237
Sen AGrad TFerreira PClaussen J(2024)(How) Does User-Generated Content Impact Content Generated by Professionals? Evidence from Local NewsManagement Science10.1287/mnsc.2023.496270:9(6045-6068)Online publication date: 1-Sep-2024
https://dl.acm.org/doi/10.1287/mnsc.2023.4962

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