Who Captures the Power of the Pen?
Review of Financial Studies, 2018,43–96
122 Pages Posted: 6 Mar 2014 Last revised: 29 Nov 2018
Date Written: January 16, 2017
We study how government control affects the roles of the media as an information intermediary and a corporate monitor. Comparing a large sample of news articles written by state-controlled and market-oriented Chinese media, we find that articles by the market-oriented media are more critical, more accurate, more comprehensive, and timelier than those by the state-controlled media. Moreover, only articles by the market-oriented media have a significant corporate governance impact. Subsample analyses, interviews with journalists, and a survey of university students suggest that the market-oriented media’s superior effects are explained by their operating efficiency and independence.
Keywords: Media coverage, media concentration, political capture, CEO turnover
JEL Classification: G32, G34, J33, M41
Suggested Citation: Suggested Citation