Asymmetric Perceptions of the Economy: Media, Firms, Consumers, and Experts (original) (raw)
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Review of Social Economy, 2014
Three major surveys of professional journalists, in 1976, 1986, and 1996, suggest that the vast majority consider themselves to be neutral, objective, and balanced observers, whose role is merely to provide information. But how neutral is the media, in terms of its orientation and effects on the behavior of the markets? In this paper, we unite a number of literatures to suggest that by choosing what event to report, how much and how frequent to report an event, and by choosing what descriptive tone to adopt in their coverage, the media has a non-neutral impact on the economy. We report evidence to suggest that: (1) the media helps set the public agenda, by promoting certain events and causes, for better or for worse; (2) the media influence the public's perception of risk, by disproportionately sensationalizing risk and by emphasizing probable negative consequences over probably positive ones; (3) the media influences elections and their outcomes; (4) the media influences the public's perception of the manager, the reputation of the firm, and the goods that the firm produces; (5) the media shapes consumer sentiment and the consumers' willingness to spend; and (6) the media shapes business sentiment and influences both firm-and market-level behavior. In doing so, we demonstrate conclusively that the media is not neutral: the media alters the public's perception of reality. In other words, we suggest not only that the media reports the news, but also shapes the world in which we live.
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Objective. Work on economic news argues that U.S. coverage focuses primarily on changes rather than levels of future economic conditions; it also both affects and reflects public economic sentiment. Given that economic perceptions are related to policy preferences and government support, this is of consequence for politics. This article explores the generalizability of these findings. Methods. Using nearly 100,000 stories over 30 years in the United States, the United Kingdom, and Canada, we compare media tone, public opinion, and economic conditions. Result. Analyses demonstrate that media tone and public opinion follow future economic change in all three countries. Media and opinion are also related, but the effect mostly runs from the public to the media, not the other way around. Conclusion. These results confirm the generalizability of prior findings, and the importance of considering more than a simple unidirectional link between media coverage and public economic sentiment.
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Do economic performance and economic news coverage influence public perceptions of the economy? Efforts to assess the effects are hampered by the interrelationships among the variables. In this paper, we bring to bear a more careful accounting of available economic variables than previous studies have used. We find that both media tone and economic attitudes are strongly related to actual economic performance. Moreover, after taking into account the economy itself, a substantial relationship between media tone and economic attitudes persists. Given that economic attitudes influence a wide variety of political outcomes, this finding carries important normative and political significance.
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This study examines contradictory claims about the news media's coverage of the economy. After discussing various sociological perspectives on news media, I compare the objective performance of California's economy, as measured by statistical indicators, to accounts of the economy found in the state's largest newspaper-the Los Angeles Times. The data reveal that, despite growth patterns that overwhelmingly favored economic elites, the negative news about the economy disproportionately depicted events and problems affecting corporations and investors instead of the general workforce. When the Times did discuss problems affecting workers, the articles were relatively short, most often placed in the back sections of the newspaper, and rarely discussed policy alternatives to the status quo. Moreover, unlike the viewpoints of business leaders and government officials, the viewpoints of workers or their spokespersons were rarely used as sources of information. These findings provide qualified support for existing scholarship purporting that the news media, when reporting on the economy, privilege the interests of corporations and investors over the interests of the general workforce.
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This article considers the process by which local economic news coverage influences individual evaluations of the economy. We improve on prior research by capturing a wider range of news sources (including national network news, national newspapers, local television news, and local newspapers) and connecting the effects of this coverage on individual level attitudes. We find that current personal financial evaluations, personal financial expectations, and short-term (12-month) expectations for the U.S. economy are related to national network coverage. Local television coverage of the economy is related to personal financial evaluations but not short-term economic expectations and local print news is important in structuring expectations of future business conditions. Overall, the findings illustrate important differences in economic coverage across media outlets and the effects of these differences on economic expectations. Exposure to different sources of economic information have ...
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International Journal of Public Opinion Research , 2002
This study examined the complex relationships among recession news, the state of the economy, and people's perceptions toward the economy from January 1987 through March 1996 using trivariate vector autoregression (VAR) analysis. Most of the time‐series variables were found to have structural changes during this time frame. With the help of the Chow test, the researchers were able to determine January 1991 as the cut‐off point to divide the entire period into two: downturn period and recovery period. The relationships among these three time‐series were found to be dramatically different across the two distinct periods. The paper concludes that: (1) the situational factor (different states of economy) played a crucial role in determining how the public evaluates the economy; (2) the extent to which recession news' impact on people's assessment of the economy depended on different economic circumstances; (3) news coverage responded differently across these two distinct periods but, in the long run, followed the economic reality; and (4) the public's sentiments toward the economy can predict economic performance.
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