1 Introduction The descript ive account s of the media industry(Mencken 1975, Goldberg 2002), as well as journalism text books(Jamieson and Campbell 2002) recognize that media out lets do not just report plain facts. One commonly noted bias in report ing is ideological During President Clinton's impeachment trial the right-leaning media supported im- peachment, arguing that even a small lie in a civ il deposit ion const it utes a ma jor crime The left-leaning media, in contrast, saw the trial as a wit ch-hunt, treating the very same violat ions condemned by the conservat ive press as trivial. Another, perhaps less com- monly noted, bias is not ideological at all, but rather results from the need to tell a memorable story. Thus bot h the conservat ive and the liberal media condemned Wen Ho Lee as a Chinese spy, wit hout entert aining the possibility that he was scape-goated by dishonest officials The media were surely biased, and probably wro In this paper, we draw a sharp analytical dist inct ion between these two kinds of biased report ing. We call the tradit ional left or right bias ideology, and the less tradi tional bias- one based on the need to tell a story - spin. We see ideology as coming direct ly from the preferences of eit her editors porters For example, left wing newspapers may simply prefer to report news one way. We see spin, on the ot her hand,as coming from a new spaper's attempt to tell a simple and memorable story The act of simplication leads to bias since some informat ion is necessarily discarded. We examine the consequences of bot h ideology and spin for the accuracy of news re- Our principal interest is how compet ition affect s accuracy even wit h competition, the truth may not always come out, especially when spin We consider the case of private media out lets maxin t he we fare of t heir owners which depends on ideology and profits. We begin with the case of a monopoly news supplier. We est ablish that, wit h Bayesian readers, only the ideology of the media out let is a source of bias in reporting. But we also consider the case of readers who are categorical thinkers- have limited memory, and can only remember the"bottom line. This psy chological assumption allows us to analy ze the commonly noted need1 Introduction The descriptive accounts of the media industry (Mencken 1975, Goldberg 2002), as well as journalism textbooks (Jamieson and Campbell 2002) recognize that media outlets do not just report plain facts. One commonly noted bias in reporting is ideological. During President Clinton's impeachment trial, the right-leaning media supported im￾peachment, arguing that even a small lie in a civil deposition constitutes a ma jor crime. The left-leaning media, in contrast, saw the trial as a witch-hunt, treating the very same violations condemned by the conservative press as trivial. Another, perhaps less com￾monly noted, bias is not ideological at all, but rather results from the need to tell a memorable story. Thus both the conservative and the liberal media condemned Wen Ho Lee as a Chinese spy, without entertaining the possibility that he was scape-goated by dishonest ocials. The media were surely biased, and probably wrong. In this paper, we draw a sharp analytical distinction between these two kinds of biased reporting. We call the traditional left or right bias ideology, and the less tradi￾tional bias - one based on the need to tell a story { spin. We see ideology as coming directly from the preferences of either editors or reporters. For example, left wing newspapers may simply prefer to report news one way. We see spin, on the other hand, as coming from a newspaper's attempt to tell a simple and memorable story. The act of simplication leads to bias since some information is necessarily discarded. We examine the consequences of both ideology and spin for the accuracy of news re￾porting. Our principal interest is how competition aects accuracy. We show that, even with competition, the truth may not always come out, especially when spin is important. We consider the case of private media outlets maximizing the welfare of their owners, which depends on ideology and prots. We begin with the case of a monopoly news supplier. We establish that, with Bayesian readers, only the ideology of the media outlet is a source of bias in reporting. But we also consider the case of readers who are categorical thinkers - have limited memory, and can only remember the \bottom line." This psychological assumption allows us to analyze the commonly noted need 2