Winner of the New Statesman SPERI Prize in Political Economy 2016

Friday, 16 May 2014

The media, the market and truth

I read with interest a recent article by Greg Mankiw about media bias (HT Mark Thoma). It discussed research by Gentzkow and Shapiro on the US newspaper industry. They find that a newspaper’s political slant is governed by the politics of its readership rather than the politics of its owner. Of course television and radio are different from newspapers, and the UK newspaper industry is rather different from that in the US. But what interested me were Mankiw’s own closing remarks:

“These findings speak well of the marketplace. In the market for news, as in most other markets, Adam Smith’s invisible hand leads producers to cater to consumers. But the findings also raise a more troubling question about the media’s role as a democratic institution. How likely is it that we as citizens will change our minds, or reach compromise with those who have differing views, if all of us are getting our news from sources that reinforce the opinions we start with?”

Now even raising this question sounds rather radical, and potentially paternalistic. Should we stop people reading what they want to read, because we think it would be good for them to read something else?

The problem with political bias is that it covers a multitude of sins. At its most innocent, it can simply be presenting facts within a political or ideological context that matches that of the reader. In the UK, a lot of the reporting in the Guardian, or Telegraph, is of this kind. Where it gets more difficult is when this bias determines which facts get reported.

Take this report in the Daily Mail about the UK food banks run by the charity the Trussell Trust. (Or, as some government sources apparently like to describe the Trust, as a ‘business’ seeking publicity.) It is written as an expose, designed to give you the impression that the numbers of people using the Trust (almost a million) should not be taken at face value. It might just work, for someone who wants to avoid the implications of such a large increase in the use of UK food banks. Anyone with a different perspective would either laugh or get angry. (When the article was highlighted on twitter, donations to the charity increased.) You can spot one or two untruths: a headline says their reporter got three days of food ‘no questions asked’, when the article makes clear questions were asked. But mainly this article is biased because of its highly selective choice of facts presented.

(In reality a large part of the increase in demand at UK food banks seems to reflect mistakes made as a result of government changes to welfare, as this Economist article explains, or as John McDermott reports in this excellent piece of journalism. So the bias in this Mail report is not only in the ‘slant’, but the deliberate absence of key facts considered by the Economist and FT.)

At its most extreme bias can involve making things up. At the beginning of this year rules on Bulgarian and Romanian workers coming to work in the UK were relaxed.  Here is a report in the Daily Mail online, indicating a rush of workers taking advantage of this relaxation. As this comprehensive discussion makes clear, the report was essentially a work of fiction. As this report shows, the costs to the newspaper of making things up in this case were minimal. (We have just had the figures for the first quarter: employment of Bulgarians and Romanians went down compared to the previous quarter.)

The traditional view is that slanting news and a highly selective choice of facts is tolerable, but making things up is not. The idea here is that people read newspapers on the understanding that they are based on facts rather than fiction, so including news stories that are made up is the equivalent of misreporting the sugar content on the packaging of some food. So the only thing that should worry us here is that whereas the manufacturer of a food product would presumably be subject to a large fine and damaging publicity if it got its food labelling wrong, a newspaper can effectively get away with it.

Yet this distinction does not address Greg Mankiw’s concern. If people are only told the facts that they are comfortable with, they will never change their minds. And as Paul Krugman observes (via Mark Thoma), if it is only the media read by your political opponents who will cry foul, politicians who just want to ‘play to the base’ are tempted to also distort or manufacture evidence, perhaps leading to descent into a world of fantasy.

Does this selection of facts actually influence people? Fewer people in the US think climate change is a major threat to their country than almost anywhere else (HT George Monbiot). The figure for the UK is also unusually low. This is particularly ironic as a good deal of the science telling us it is a major threat is done in these two countries. A major reason (pdf) why people in the US and UK think this way is that they are allowed the freedom to not to be told about the science, or to be given the opinions of skeptics as if they carried equal or more weight than the vast majority of scientists. (I look at other evidence of influence here.)

So this is an important issue. But can Mankiw be rescued from the charge of paternalism? (No, I never expected to write that line either.) I just want to raise two final thoughts. First, do we know that people are happy not to be told important facts that they might find challenging? If they had a choice between a newspaper that presented all the facts from their own ideological perspective, and another identical paper which only gave them the facts they wanted to hear, would they really choose the latter? Perhaps people do not get that choice. Second, even if they might sometimes choose the latter option, do they want that option? Perhaps it is a bit like being on a diet. We know we might be tempted never to be confronted with facts that challenge our priors, but we know we really should be. So just as those on a diet would rather not be constantly faced with the choice of lots of fattening foods, so perhaps people would not object if they did not have the option of just hearing what they wanted to hear. 


  1. "First, do we know that people are happy not to be told important facts that they might find challenging? If they had a choice between a newspaper that presented all the facts from their own ideological perspective, and another identical paper which only gave them the facts they wanted to hear, would they really choose the latter? Perhaps people do not get that choice."

    There's quite a lot of research into how people consume news on the Internet (none of which I can lay my hands on now - Cass Sunstein?) that suggests that people seek out sources of information that confirm their pre-existing prejudices and avoid those that challenge them. Indeed one of the most striking effects of the modern communication era may be that it makes it easier to avoid challenges to your opinions and drives a deepening polarization of the political landscape.

    1. Here is a study which suggests less segregation:
      (HT Romesh Vaitilingam)

  2. Ok, so the media and, as Mankiw points out, the markets in general, are mostly demand-driven. Thank you Greg for confirming that.

  3. Economics expands to demonstrate yet another area of life, the press, that it is willing to debate in market terms despite a glaring lack of basic knowledge.

  4. For example, could anyone please point out, from the notoriously pro-God Guttenberg Bible to the notoriously pro peace and bipartisanship Washington Post, what they have in mind when referring to the "traditional view" of allowable bias? And could somebody please demonstrate an understanding of the fact that in the US, "the press" consisted of high school drop outs until 1945, when the professional objective media came into being, with a back story claiming it had always been there?

  5. As a right wing guy, I find your blog a bit like the Krugman view that really liberals are smarter and their views are just right, period. I think of when I commented to a left wing economist that is US, based on tax data, the income shares of different groups were unchanged, so with increased need based government aid one should conclude that under any meaningful measure income inequality had decreased. He just said other sources differed. You climates change example is very telling. Go back to 2000, and look at climate change predictions. Have they proved accurate. Have the models proved accurate? No one really denies climate change, just how much, is it caused by man, and can we do anything about it?

  6. Right wing guy should look at Charles Hansen's early and much maligned predictions about climate change. He was wrong, in that he underestimated it.

  7. It's James Hansen, Anonymous.


    That Climate is changing rapidly due to man-made releases of greenhouse gases is fact.

    But what I find more interesting is what to do about it. Here Krugman, Thoma, like many, centrist-liberals like the confirm their biases (Pro-renewables, anti or indifferent or vacillating towards nuclear and gas). They don't get called on it, really, by their economist brethren. (Not that their is anything "wrong" with advocating renewables: but it's a tougher argument that they make it out to be.)

    Contrast their opinions on energy policy to those of Hansen:

    Or the reality of energy production and use:

    Note the dominance of fossil fuels. (And in Canada's case, the current dominance of Uranium energy (mostly exported), over that of oil and gas. If the world were using gen4 nuclear technology, the potential energy in that same amount of U would increase by at least two orders of magnitude, totally dwarfing the oil and gas energy.)

    Also note that renewables provide only a sliver of current energy. They would have to increase by several orders of magnitude to replace, or even dent, fossil-fuel energy. There is no guarantee that the economics of renewable energy systems observed today (for example, getting moderately cheaper every year) would, in fact, scale with an increase in their use commensurate to making an actual difference in mitigating climate change.

  8. I offer this as a thought: economics and journalism came into being at roughly the same time in history, late 17th early 18th centuries (I steal Antoin Murphy's start figure of Sir William Petty for macroeconomics, and I throw in L'Estrange and his non-statist rivals for journalism in England).

    Adam Smith, incidentally, came to believe that only a few economists understand economics (see 'Adam Smith and tradition: The Wealth of Nations before Malthus' by Richard Teichgraeber in Economy, Polity, and Society: British Intellectual History 1750-1950).

    And in Alec Cairncross's autobiography he reports Keynes saying the same thing to him as Smith above.

    Funny old games.

  9. I think the neo-liberal orthodoxy has to think a bit more critically about immigration. In other disciplines, anthropology, political science, people know why immigration is a concern. It is true that it is largely, but not only, about jobs. It is also true that under New Labour little was done for unskilled labour in this country to prepare for (by the orthodoxy) a very unexpected flood of immigrants following the expansion of the EU eastwards in 2004. Really the orthodoxy should have prepared for this. First they said that only a few thousand would come; when a million came, they said they would return. When they did not return they said it was good for us. None of this is helpful, whatever the media says.

    Another big tragedy is because of continuing high inflows from the A8, we cannot let desperate Syrian refugees.

    The big fear is when the economy picks up and we get jobs growth, these jobs will go to highly elastic supply from the A8, and maybe Bulgaria and Romania as well. Are we prepared? Or is only UKIP and the right wing press going to run the media show and drive the immigration agenda? What we do not want to hear is more talk about employment growth, without a dent in native employment. Are we going to have another lost generation of permanently native unemployed?

  10. Consider two examples of media in the US (cable news networks rather than newspapers), Fox News and MSNBC. Both may be said to fit Mankiw's description of media whose news coverage has been determined in some fashion by "consumers". That is, both aim their news coverage at specific audiences -- Fox News, at very conservative viewers, most of whom happen to be elderly, and MSNBC, at liberal/progressive viewers who are younger. From a strictly business perspective, Fox News made the better choice, because its share of elderly, retired viewers have more time during the day to watch its programs hours on end. But how well do these two networks "report" the news and present viewpoints that may challenge their viewers? It's a fair comment that Fox News never presents such viewpoints, while MSNBC does. My sense of the latter's editorial and news policy is that, if substantial scientific evidence emerged to contradict claims of human-caused climate change, MSNBC would report such news. (Fox News would suddenly discover that it did indeed value science after all, and also report such news.) Setting aside the issue of which network is better as a "democratic institution", consider whether these two examples demonstrate Mankiw's assertion that they "speak well of the marketplace" and are positive evidence of the success of its "invisible hand" guiding us to the best outcome. I think they prove exactly the opposite -- the failure of the marketplace. The "hand" at work here is entirely visible. Fox News and MSNBC could not exist in their current form if they were required to present news objectively (a loaded word, I know, but there are criteria to determine objectivity), and if they were also required to present different analyses and opinions with at least something like an even hand. In the US, the government, with respect to parceling out spectrum of airways (TV and radio), public property by the way, at one time had rules that promoted such behavior. Alas, no longer. What Mankiw's demonstrates is an abysmal failure of the marketplace, not its success, and he makes, perhaps inadvertently, a pretty good argument for government intervention, especially in the use of public property such as airways.

    1. I agree, and in a way that was partly what I was trying to suggest in my post. In the UK, TV and radio are subject to impartiality rules, while as you note the 'fairness doctrine' was abolished under Reagan. For UK newspapers on the left, bias tends to be of the mild kind. Selection of facts and deliberate distortion are much more commonplace on the right. As I suggested at the end, it is far from clear that this strong form of bias is what readers seek.

  11. Your focus, is understandably, on what is published, and by whom. However, and maybe more important is what is not published! The media operates its own form of censorship.


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