Friends in Media

68 Pages Posted: 4 Jun 2018 Last revised: 2 Mar 2022

See all articles by Guosong Xu

Guosong Xu

Rotterdam School of Management, Erasmus University

Date Written: March 1, 2022


We test the independence of news content from journalists’ social networks. We find that business news reported by connected journalists — such as those sharing a working relationship or common schooling institutions with the respective company management — is associated with markedly more favorable coverage. Connected articles predict higher market prices followed by a long-term reversion. Moreover, these articles distort firms’ capital allocation, suggesting real effects of journalist connections in the economy. We make causal inferences about the connection effects by exploring exogenous journalist turnovers and an ownership change of the Wall Street Journal.

Keywords: Media Slant, Financial Journalism, Social Connections, Real Effects, M&A

JEL Classification: G14, G34, G40

Suggested Citation

Xu, Guosong, Friends in Media (March 1, 2022). Available at SSRN: or

Guosong Xu (Contact Author)

Rotterdam School of Management, Erasmus University ( email )


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