comments on della vigna and kennedy
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Comments on Della Vigna and Kennedy
Joel WaldfogelMoscow
October 28, 2011
Neat paper!
• Oodles of evidence trained on question: “does joint ownership of media outlet and movie studio cause better reviews?”– “oodles” means N → ∞
• Compelling controls, believable estimate• Comments– Earnest praise– Finding’s meaning– Effect of “concentration”
• Elements of a good story…
villains
heroes
• Bias-detecting sleuths
Characters you’re not sure about until the end
Make a wish
• Suppose you wanted to know whether films receive better reviews at studio-owned media outlets
• Wish list: it would be nice to have a context with – Change in ownership, with reviews before and after– Data on multiple outlets’ reviews of same movies– Half a million observations
• Amazingly, this is what Stefano and Alex have!
Drum roll, please
• We have countenanced the devil• …and what does he look like?
Regular vs diabolical reviews
Another perspective
Answer: 3 points at Fox-owned, 0 at Time Warner, on a mean review of 60
Economic vs statistical significance
• N → ∞– SD of mean: σ/√N– Many things will become statistically significant – Will see *** in tables, but size matters
• Aside– Suppose N had been merely 100,000– Could have convinced me of no effect– Effect is hard to detect
Implications of results
• Does ownership affect reviews?– A series of case studies– Yes at Fox, no at Time Warner– Yes for some reviewers, no for others
• Would like an explanation of why sometimes yes
What is the policy takeaway?
• Don’t let Murdoch own stuff?
• or
• “on balance, no evidence that it matters much”
Paper Motivation
• “Does Media Concentration Lead to Biased Coverage?”
• What do you think when you hear “media concentration”?
Possible effects of “concentration”
• Product positioning incentives associated with joint ownership– Internalization of business stealing externalities– This paper’s not about that
Competition and product quality?
• Does competition keep reviewers honest vs undermining ability to finance high fixed costs
• Would require variation in amount of competition• Not what this paper wants to be about
Product positioning and owner preferences
• Related to– Podolny and Scott-Morton • what movitates wine makers – “Love or Money?”
– Race and ownership • FCC had traditionally tried to promote minority
ownership
• Maybe change title– “concentration” evokes the wrong imagery here
Another point of contact
• This is a merger retrospective– Cf. Ashenfelter, Hosken, etc.
• Usually, look at price changes following merger– Selected sample of allowable mergers– Here, merger likely exogenous
• Post-merger product repositioning
Thanks
• Neat paper!• Impressive exercise• Convincing estimates
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