The Media Goes Where They’re Needed: The Relation between Firms’ Investor Base and Media Coverage

The financial media provides information to investors by monitoring firms for malfeasance, such as fraud and excessive CEO pay (Miller, 2006; Core, Guay, and Larcker, 2008). The media also helps investors monitor more mundane corporate activities, such as periodic earnings announcements. However, it is unclear why certain firms get extensive media coverage, along with the resulting benefits, […]

The Information Role of the Media in Earnings News

A central question about the media’s role in capital markets is whether media coverage influences investors’ reactions to firms’ disclosures, such as earnings releases. Multiple studies provide evidence consistent with the media disseminating, but not creating, information that influences the market’s earnings response. Specifically, they find that brief articles without, but not lengthier articles with, […]