Media as a Money Doctor: Evidence from Refinancing Decisions

Abstract

We argue that business TV helps households avoid costly mistakes in mortgage refinancing. We use three sources of variation in TV exposure: (1) staggered entry of business networks into zip codes, (2) channels’ ordinal positions in the cable lineup, and (3) channel regroupings from system upgrades that alter their salience to the viewer. Exposure to business TV is associated with a higher refinancing propensity, faster response, and fewer incomplete applications. These behaviors generate large economic savings. The effects are driven by general-audience networks—Fox Business and CNBC—and do not arise for the professionally oriented Bloomberg TV.

Keywords: media, television, financial literacy, financial awareness

JEL Classification: G50, G51, G53, R20, R21