Social Media and Corruption
Institute for Political Economy and Governance; Universitat Pompeu Fabra; New Economic School
New Economic School (NES); Institute for Political Economy and Governance, Barcelona; Universitat Pompeu Fabra
Higher School of Economics; Centre for Economic Policy Research (CEPR)
In democratic countries, traditional mass media provide an important mechanism of fostering accountability. Do new media such as blogs play a similar role in authoritarian countries with suppressed offline media? We study consequences of blog posts about corruption in Russian state-controlled companies. We identify negative impact of blog posts on stock returns of these companies, using five-minute, daily, or monthly data. We use incidents of distributed denial-of-service (DDoS) attacks on other blogs to confirm that the results are not driven by unobserved heterogeneity. We show that blog posts increase corporate accountability as evidenced by higher management turnover and less corporate conflicts.
Number of Pages in PDF File: 47
Keywords: political economy, blogs, Russia, Alexei Navalny, corruptionworking papers series
Date posted: September 27, 2012 ; Last revised: November 23, 2013
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