Media Bias in Financial Newspapers: Evidence from Early-Twentieth-Century France
University of Paris West Nanterre La Défense, Economix Working Papers Series # 2009-4
35 Pages Posted: 28 Nov 2009
Date Written: October 1, 2009
The financial market was well developed in France in the years before World War I, and there were many newspapers that provided information to investors. Yet commentators at the time faulted the financial press for inaccuracy and biases, which they linked to the existence of payments made by companies for coverage in the editorial section. This paper tests whether the payment scheme induced a systematic bias in the coverage of companies listed on the Paris stock exchanges by newspapers. The results show that, although firms’ media coverage was affected, the performance of firms actually touted by the press was good. Thus, the media bias can also be explained by newspapers choosing the companies' exposures according to their editorial policy.
Keywords: Media coverage, newspapers, media bias, financial markets
JEL Classification: G11, G12, L15, O16, N13
Suggested Citation: Suggested Citation