Political Differentiation in Newspaper Markets

Abstract

Economists disagree about whether competition causes the ideologies of media markets to converge or diverge. This paper analyzes the eect of media competition on the political ideologies of media outlets as well as on the news consumption of the general public. Using the National Annenberg Election Surveys of 2000 and 2004, empirical results show that in markets with only one newspaper, residents who are at ideological extremes may choose not to read a newspaper. However, in competitive markets, residents who are at the extremes are more likely to read a newspaper than in the monopoly case. The results also show that newspaper competition reduces the incentive among those with extreme ideologies to access political information online. These results suggest that readers prefer a newspaper with an ideology close to their own and that newspaper competition will induce newspapers to specialize in dierent ideologies.