News Aggregators and Competition among Newspapers on the Internet
- (pp. 91-114)
AbstractThis paper studies how news aggregators affect the quality choices of newspapers competing on the Internet. To provide a micro-foundation for the role of the aggregator, we build a model of multiple issues where newspapers choose their quality on each issue. Our model captures well the main trade-off between the "business-stealing" effect and the "readership-expansion" effect. We find that the aggregator increases the quality only if the readership-expansion effect is large enough relative to the business-stealing effect. Using a condition obtained from empirical results, we find that the aggregator increases the quality and social welfare, but affects newspapers' profits ambiguously.
CitationJeon, Doh-Shin, and Nikrooz Nasr. 2016. "News Aggregators and Competition among Newspapers on the Internet." American Economic Journal: Microeconomics, 8 (4): 91-114. DOI: 10.1257/mic.20140151
- D21 Firm Behavior: Theory
- D22 Firm Behavior: Empirical Analysis
- L13 Oligopoly and Other Imperfect Markets
- L82 Entertainment; Media