Media Competition and News Diets
American Economic Journal: Microeconomics (Forthcoming)
Technological innovations in content delivery, such as the advent of broadcast television
or of the Internet, threaten local newspapers' ability to bundle their original local
content with third-party content such as wire national news. We examine how the entry
of television—with its initial focus on national news—affected local newspapers as
well as consumer news diets in the United States. We construct a novel dataset of U.S.
newspapers' economic performance and content choices from 1944 to 1964 and exploit
quasi-random variation in the rollout of television to show that this new technology was
a negative shock in both the readership and advertising markets for newspapers. Newspapers
responded by providing less content, particularly local news. We tie this change
towards increasingly nationalized news diets to an increase in party vote share congruence
between Congressional and Presidential elections.