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Media bias in financial newspapers: evidence from early twentieth-century France

Published online by Cambridge University Press:  11 August 2010

VINCENT BIGNON  and
ANTONIO MISCIO
VINCENT BIGNON
Affiliation:
Graduate Institute of International and Development Studies, Department HPI, Rue de Lausanne 132, case postale 136, 1211 Genève 21, Switzerland, and EconomiX – University of Paris Ouest Nanterre La Défense, France, [email protected].
ANTONIO MISCIO
Affiliation:
Columbia University, Economics Department, [email protected]
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Abstract

The financial market was well developed in France in the years before World War I, and there were many newspapers that provided information to investors. Yet commentators at the time faulted the financial press for inaccuracy and biases, which they linked to the existence of payments made by companies for coverage in the editorial section. This article tests whether the payment scheme induced a systematic bias in the coverage of companies listed on the Paris stock exchanges by newspapers. The results show that, although firms' media coverage was affected, the performance of firms actually touted by the press was good. Thus, the media bias can also be explained by newspapers choosing the companies' exposures according to their editorial policy.

Type
Research Article
Information
European Review of Economic History , Volume 14 , Issue 3 , December 2010 , pp. 383 - 432
Copyright
Copyright © European Historical Economics Society 2010

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