The Impact of Market Competition on Journalistic Performance
By
Eva-Maria Jacobsson,
Lee B. Becker,
Tudor Vlad,
C. Ann Hollifield and
Adam Jacobsson
Abstract
Recent theorizing, supported by some empirical evidence, suggests that increased levels of media competition leads to lower levels of journalistic performance, contrary to the basic argument in economics that market competition always leads to positive outcomes.
This challenge to the basic arguments of economics results from the experiences of
emerging media markets. Quite often, in those markets, too many media outlets are competing
for too few financial resources because media outlets are created because of the social and
political value of media ownership. Media assistance programs from donors in established
markets often contribute to this high level of competition by encouraging the proliferation of media
outlets through direct financial subsidies or indirect subsidies provided by training programs.
In all markets, media organizations must compete for limited financial resources. If the resources are inadequate to support the media, the competition can result in an environment where journalists can be easily bribed, sensationalism will dominate, and media coverage will be imbalanced. In sum, the high levels of competition, called by some “hypercompetition,” will result not in improved journalism but in the opposite.
Empirical tests of this expectation that high levels of competition are associated with low levels of journalistic performance have been limited because of the inadequacy of data. This paper draws on a more robust data set than has been available in the past to extend earlier work that has provided support for the expectation of the negative consequences of hypercompetition.
