Macroeconomics Seminar - Heng Chen (University of Hong Kong)

Room 315, Level 3, FBE Building, 111 Barry Street, Carlton


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Lawrence Uren

T: +61 3 83447915

Title: Negativity in the News: Supply and Demand

Abstract: The news market is overwhelmingly negative, i.e., news consumers pay more attention to bad news and media outlets bias their news content towards the negative. We show the demand for negativity can arise when news consumers have doubts about the quality of news outlets and dislike such uncertainty. Uncertainty averse consumers infer the negative news is of higher quality and are more willingly to acquire negative contents. In response, the media firm tends to select negative content to report and suppresses the positive one. Further, the news content is also framed negatively to grab attention.