Political Polarization in Financial News

Standard explanations for political polarization of news don't apply to financial news.

Nevertheless, we find strong evidence of political polarization in corporate financial

news on both intensive and extensive margins of coverage. To control for firm and

newspaper heterogeneity, we compare coverage of the same firm-level events by news-

papers with opposing ideologies. We find that politics-driven disagreement in news

increases trading, and investors respond to news about a stock in the newspaper they

read by trading more and in the same direction as other investors who read the same

news. The results are consistent with polarization leading to information segregation.

Zoom link: https://eur-nl.zoom.us/j/97586791595?pwd=Z2NFYlBKQmhOQ3ljL09YK2JxNkt2QT09

Meeting ID: 975 8679 1595