Hotelling competition and political differentiation with more than two newspaper

S. Behringer, L. Filistrucchi

Research output: Contribution to journalArticleScientificpeer-review

Abstract

We analyse a market where newspaper publishers compete for advertising as well as for readership. Publishers first choose the political position of their newspaper then set cover prices and advertising tariffs. We build on the duopoly model of Gabszewicz et al. (2001, 2002) who show that advertising financing can lead to minimum political differentiation of the newspapers and hence a lack of plurality of political views or pensée unique. We extend their model to more than two newspapers and show that, contrary popular belief in competition policy, concern for such lack of plurality may diminish but does not disappear as the number of firms increases.
Original languageEnglish
Pages (from-to)36-49
JournalInformation Economics and Policy
Volume30
DOIs
Publication statusPublished - 2015

Fingerprint

competition policy
market
Hotelling
Plurality
firm
financing
price
tariff
Tariffs
Competition policy
Financing
Duopoly

Keywords

  • Media firms
  • Two sided markets
  • Hotelling oligopoly

Cite this

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Hotelling competition and political differentiation with more than two newspaper. / Behringer, S.; Filistrucchi, L.

In: Information Economics and Policy, Vol. 30, 2015, p. 36-49.

Research output: Contribution to journalArticleScientificpeer-review

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AB - We analyse a market where newspaper publishers compete for advertising as well as for readership. Publishers first choose the political position of their newspaper then set cover prices and advertising tariffs. We build on the duopoly model of Gabszewicz et al. (2001, 2002) who show that advertising financing can lead to minimum political differentiation of the newspapers and hence a lack of plurality of political views or pensée unique. We extend their model to more than two newspapers and show that, contrary popular belief in competition policy, concern for such lack of plurality may diminish but does not disappear as the number of firms increases.

KW - Media firms

KW - Two sided markets

KW - Hotelling oligopoly

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