How the Internet Changed the Market for Print Media

79 Pages Posted: 13 Feb 2023 Last revised: 16 Jul 2023

See all articles by Manudeep Bhuller

Manudeep Bhuller

University of Oslo - Department of Economics; Statistics Norway

Tarjei Havnes

Norwegian Ministry of Labour and Social Inclusion

Jeremy McCauley

University of Bristol

Magne Mogstad

University of Chicago

Multiple version iconThere are 2 versions of this paper

Date Written: February 2023

Abstract

Combining comprehensive data from the Norwegian media market on newspaper circulation, readership, revenues, factor inputs, and product characteristics with plausibly exogenous variation in the availability and adoption of broadband internet, this paper provides causal evidence on how the internet affected the traditional print media market. Household adoption of broadband internet triggered large reductions in print readership and circulation and equally large increases in online news readership. Despite strong substitution from print to online news consumption, newspaper firms’ revenues fell by almost 30%. Newspaper firms responded by dramatically cutting costs, either by shedding labor inputs or by reducing the physical size of newspaper sheets, and in doing so avoided meaningful losses in profits. The printed newspaper product available to customers also changed, as newspapers shifted content away from tabloid to more serious news. This paper offers a case study on how an adverse technology shock transmits through firms with multiple margins of adjustment, and provides an explanation for the economic resilience of newspapers.

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Suggested Citation

Bhuller, Manudeep and Havnes, Tarjei and McCauley, Jeremy and Mogstad, Magne, How the Internet Changed the Market for Print Media (February 2023). NBER Working Paper No. w30939, Available at SSRN: https://ssrn.com/abstract=4356223

Manudeep Bhuller (Contact Author)

University of Oslo - Department of Economics ( email )

P.O. Box 1095 Blindern
N-0317 Oslo
Norway

HOME PAGE: http://sites.google.com/site/manudeepbhuller

Statistics Norway ( email )

N-0033 Oslo
Norway

HOME PAGE: http://sites.google.com/site/manudeepbhuller

Tarjei Havnes

Norwegian Ministry of Labour and Social Inclusion ( email )

Jeremy McCauley

University of Bristol ( email )

Magne Mogstad

University of Chicago ( email )

1101 East 58th Street
Chicago, IL 60637
United States

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