Abstract
This paper investigates how media attention to customers affects the supplier's information environment from the perspective of real earnings management. Our empirical results for 2010–2020 reveal a negative association between media attention to customers and the supplier's real earnings management. Causality is established through the instrumental variable two-stage least squares approach. Cross-sectional tests further illustrate that more external supervision and internal constraints are two potential channels for this observed relationship. Overall, our findings emphasize that the media, as a crucial information intermediary, significantly affects the behavior of companies in the supply chain.
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