Press Coverage of Tax Reforms and Interest Groups

61 Pages Posted: 28 Aug 2023 Last revised: 8 Feb 2024

See all articles by Arndt Weinrich

Arndt Weinrich

Paderborn University; TRR 266 Accounting for Transparency

Date Written: January 22, 2024

Abstract

I investigate whether interest groups influence the textual sentiment of press coverage of tax reforms. Through 2SLS and OLS estimates, as well as the application of a modified control function approach, I identify increases in the differences among represented opinions (subjectivity effect). This subjectivity effect translates into relative increases in both positive and negative textual sentiment within an article in which an interest group appears. Additional tests of quasi-sentences reveal that interest groups rather affect articles’ textual sentiment more on the negative margin. Importantly, these insights persist when controlling for the news appearances of other external actors, namely members of the parliament. Overall, my study addresses the tension between the costs (influence-seeking) and the benefits (providing expertise) of interest group activities in (tax) standard setting by shedding light on an outside tactic of interest groups that is nearly impossible to regulate. Thereby, I elucidate the press’s role as an information intermediary when it interacts with other important economic actors.

Keywords: Tax Reform, Press Coverage, Interest Groups, Textual Sentiment

Suggested Citation

Weinrich, Arndt, Press Coverage of Tax Reforms and Interest Groups (January 22, 2024). TRR 266 Accounting for Transparency Working Paper Series No. 129, Available at SSRN: https://ssrn.com/abstract=4551643 or http://dx.doi.org/10.2139/ssrn.4551643

Arndt Weinrich (Contact Author)

Paderborn University ( email )

Warburger Str. 100
Paderborn, 33098
Germany

TRR 266 Accounting for Transparency ( email )

Warburger Straße 100
Paderborn, 33098
Germany

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