Following the 2016 U.S. presidential election, many have expressed concern about the effects of false stories (“fake news”), circulated largely through social media. We discuss the economics of fake news and present new data on its consumption prior to the election. Drawing on web browsing data, archives of fact-checking websites, and results from a new online survey, we find: (i) social media was an important but not dominant source of election news, with 14 percent of Americans calling social media their “most important” source; (ii) of the known false news stories that appeared in the three months before the election, those favoring Trump were shared a total of 30 million times on Facebook, while those favoring Clinton were shared 8 million times; (iii) the average American adult saw on the order of one or perhaps several fake news stories in the months around the election, with just over half of those who recalled seeing them believing them; and (iv) people are much more likely to believe stories that favor their preferred candidate, especially if they have ideologically segregated social media networks.

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Social Media and Fake News in the 2016 Election

Part I. Introduction: 1. Economic perspectives Part II. Media-Dependent Entertainment: 2. Movie macroeconomics 3. Making and marketing movies 4. Financial accounting in movies and television 5. Music 6. Broadcasting 7. Cable 8. Publishing and New Media 9. Toys and Games Part III. Live Entertainment: 10. Gaming and wagering 11. Sports 12. Performing arts and culture 13. Amusement/theme parks Part IV. Roundup: 14. Epilogue.

Entertainment Industry Economics: A Guide for Financial Analysis

Numerous polls suggest that COVID-19 is a profoundly partisan issue in the United States. Using the geotracking data of 15 million smartphones per day, we found that US counties that voted for Donald Trump (Republican) over Hillary Clinton (Democrat) in the 2016 presidential election exhibited 14% less physical distancing between March and May 2020. Partisanship was more strongly associated with physical distancing than numerous other factors, including counties' COVID-19 cases, population density, median income, and racial and age demographics. Contrary to our predictions, the observed partisan gap strengthened over time and remained when stay-at-home orders were active. Additionally, county-level consumption of conservative media (Fox News) was related to reduced physical distancing. Finally, the observed partisan differences in distancing were associated with subsequently higher COVID-19 infection and fatality growth rates in pro-Trump counties. Taken together, these data suggest that US citizens' responses to COVID-19 are subject to a deep-and consequential-partisan divide.

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Partisan differences in physical distancing are linked to health outcomes during the COVID-19 pandemic.

The U.S. health-care sector is large and growing—health-care spending in 2011 amounted to $2.7 trillion and 18 percent of GDP. Approximately half of health-care output is allocated via markets. In this paper, we analyze the industrial organization literature on health-care markets, focusing on the impact of competition on price, quality, and treatment decisions for health-care providers and health insurers. We conclude with a discussion of research opportunities for industrial organization economists, including opportunities created by the U.S. Patient Protection and Affordable Care Act.

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The Industrial Organization of Health-Care Markets

In recent years, many hospitals have merged, in part to gain bargaining leverage with managed care organizations (MCOs). We investigate the price impact of hospital mergers by formulating and estimating an equilibrium bargaining model between hospital systems and managed care health insurers over prices for inpatient services. We estimate the parameters of the model using claims and discharge data from Northern Virginia. In 2006, Inova Health System proposed to acquire Prince William Hospital. We nd that this merger would have raised prices signicantly and that the remedy of separate bargaining imposed by the FTC in a separate hospital case would have resulted in a larger price increase.

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Mergers when prices are negotiated: Evidence from the hospital industry

We measure how the bundling of television channels affects short-run social welfare. We estimate an industry model of viewership, demand, pricing, bundling, and input market bargaining using data on ratings, purchases, prices, bundle composition, and aggregate input costs. We conduct counterfactual simulations of a la carte policies that require distributors to offer individual channels for sale to consumers. We estimate that negotiated input costs rise by 103.0% in equilibrium under a la carte. These are passed on as higher prices, offsetting consumer surplus benefits from purchasing individual channels. Mean consumer and total surplus change by an estimated -5.4% to 0.2% and -1.7% to 6.0%, respectively. Any implementation or marketing costs would reduce both, and would likely make a la carte welfare-decreasing.

The Welfare Effects of Bundling in Multichannel Television Markets

We measure the persuasive effects of slanted news and tastes for like-minded news, exploiting cable channel positions as exogenous shifters of cable news viewership. Channel positions do not correlate with demographics that predict viewership and voting, nor with local satellite viewership. We estimate that Fox News increases Republican vote shares by 0.3 points among viewers induced into watching 2.5 additional minutes per week by variation in position. We then estimate a model of voters who select into watching slanted news, and whose ideologies evolve as a result. We use the model to assess the growth over time of Fox News influence, to quantitatively assess media-driven polarization, and to simulate alternative ideological slanting of news channels.

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Bias in Cable News: Persuasion and Polarization

We measure how the bundling of television channels affects short-run welfare. We estimate an industry model of viewership, demand, pricing, bundling, and input-market bargaining using data on ratings, purchases, prices, bundles, and input costs. We conduct simulations of a la carte policies that require distributors to offer individual channels for sale to consumers. We estimate that negotiated input costs rise by 103.0 percent under a la carte. These higher input costs offset consumer benefits from purchasing individual channels. Mean consumer and total surplus change by an estimated — 5.4 to 0.2 percent and — 1.7 to 6.0 percent, respectively. (JEL D12, L11, L51, L82, M31)

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We investigate the welfare effects of vertical integration of regional sports networks (RSNs) with programming distributors in U.S. multichannel television markets. Vertical integration can enhance efficiency by reducing double marginalization and increasing carriage of channels, but can also harm welfare due to foreclosure and raising rivals' costs incentives. We estimate a structural model of viewership, subscription, distributor pricing, and affiliate fee bargaining using a rich dataset on the U.S. cable and satellite television industry (2000-2010). We use these estimates to analyze the impact of simulated vertical mergers and de-mergers of RSNs on competition and welfare, and examine the efficacy of regulatory policies introduced by the U.S. Federal Communications Commission to address competition concerns in this industry.

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The Welfare Effects of Vertical Integration in Multichannel Television Markets

This paper quantitatively assesses time inconsistency, moral hazard, and political ideology in monopoly regulation of electricity distribution. We specify and estimate a dynamic model of utility regulation featuring investment and moral hazard. We find that (1) there is under-investment in electricity distribution capital aiming to reduce power outages, (2) more conservative political environments have higher regulated returns, and (3) more electricity is lost in distribution in more conservative political environments. We quantify the value of regulatory commitment in inducing more investment. Conservative regulators mitigate welfare losses due to time inconsistency, but worsen losses from moral hazard.

https://web.stanford.edu/~ayurukog/main_infrastructure.pdf

Ali Yurukoglu

Papers

The Welfare Effects of Bundling in Multichannel Television Markets

Bias in Cable News: Persuasion and Polarization

The Welfare Effects of Bundling in Multichannel Television Markets

The Welfare Effects of Vertical Integration in Multichannel Television Markets

Dynamic Natural Monopoly Regulation: Time Inconsistency, Moral Hazard, and Political Environments