Sung Eun Kim more sensitive to demand-side pressures than com- event involving a certain party would indicate its bias mercial newspapers.This is a reasonable assumption toward that party.When a newspaper is found to dis- as government-controlled newspapers are no more re- criminate between domestic and foreign firms in its re liant on reader demand than commercial newspapers, porting of otherwise similar recall events,one can con- and readers of official newspapers are no more na- sider it as evidence of bias.Auto recalls are particularly tionalistic than those of commercial newspapers,as well suited to this study's purpose because they happen will be elaborated later in the section on different frequently and get more media attention than other readership.Contrary to the first potential outcome, product recalls,allowing an empirical examination of an empirical finding of greater bias in commercial reporting patterns over various time periods.I also ex- newspapers would provide support for the second hy- amine the intensity and the tone of news reporting on op//s pothesis.In this case,the difference in the degree of auto recalls as supplementary measures. bias would be attributable to demand-side pressures, given that commercial newspapers are no more subject to government pressure than government-controlled Empirical Scope:News Coverage by newspapers Chinese Newspapers I examine the degree of home bias exhibited by EMPIRICAL STRATEGY the Chinese news media.The empirical focus on China provides unique opportunities for exploring the Measuring Media Bias:News Coverage on sources of media's home bias.Newspapers in China Auto Recalls are under the varying degrees of government control while operating within common economic,social and A key consideration in assessing the degree of me- political environment.All newspapers in China are ul- dia bias is to establish an objective benchmark for timately under state control.yet the degree of con- unbiased reporting.While it is relatively straightfor- trol varies substantially across newspapers.While of- ward to compare newspapers'favorability toward a ficial newspapers are tightly controlled by party orga- given party,it is challenging to set up the standard by nizations,commercially oriented newspapers enjoy a which a newspaper can be considered as biased and to greater space for news reporting than official papers what extent.Yet,establishing the standard is impera- (Stockmann 2013,68-73).Also,the highly localized na- tive because this article aims to assess the degree of ture of the Chinese news industry enables a subna- home bias exhibited by newspapers,rather than simply tional comparison of news reporting.All regional gov- comparing their favorability toward domestic versus ernments have their own official newspapers as well foreign firms as commercial newspapers operating in their localities. I address this challenge by examining a newspaper's These local governments differ in their level of inter- selective reporting behavior:How likely is a newspaper ests in the automobile industry,which allows me to pin 是 to cover the story when a similar type of negative or down the effects of governmental economic interests positive event affects a domestic versus a foreign firm? on news reporting. While an unbiased newspaper would be equally likely In essence,my empirical strategy has three basic to cover negative or positive events involving domestic components:I compare news coverage of auto re- or foreign firms,a newspaper with a home bias might calls (1)by foreign versus domestic producers,(2) selectively omit coverage of negative events affecting across official and commercial newspapers operating in domestic firms while covering positive events,and vice the same province,and(3)across provinces with and versa for foreign firms.It is worth emphasizing that the without their own automotive state-owned enterprises events that serve as a basis for comparison should be (SOEs).By comparing news coverage of foreign ver- similar to each other.Otherwise.one cannot determine sus domestic car recalls,I examine the effects of being whether the difference in reporting pattern is due to foreign while controlling for the type of news content bias or other characteristics of the events,unless they Newspapers may vary with respect to the types of news are adequately accounted for. content (e.g.,hard news versus soft news),but I focus Based on these considerations,I assess the degree on one type of recall-related news and compare a given of home bias by examining the frequency of news re- newspaper's relative tendency to cover foreign versus porting devoted to domestic car recalls relative to for- domestic recalls.Further,I examine the effects of gov- eign ones.Product recalls have obvious negative im- ernment influence by comparing official and commer- 四 plications for the quality of the products in question, cial newspapers.In so doing.I can effectively control and their characteristics are comparable across differ- for other national-or regional-level sources of bias be- ent cases.A newspaper's omission of such a negative cause the sample includes both official and commer- cial newspapers in the same province.Lastly,I compare 7 In either case.empirical support for a given hypothesis does not entirely rule out the possibility of the alternative factor.A find- Even when a newspaper tends to report less on domestic recalls ing consistent with the first hypothesis would not necessarily imply than other newspapers due to its focus on soft news than hard news. the absence of demand-side influence,because commercial newspa- the newspaper is not considered as biased in my analysis as long as pers may still exhibit bias,just to a lesser extent than government- the newspaper does not discriminate domestic and foreign compa- controlled newspapers.Similarly,empirical support for the second nies.The newspaper is considered as biased against foreign compa hypothesis would indicate limited government influence,but only nies only when they report more on foreign recalls relative to domes- relative to demand-side influence. tic recalls. 958Sung Eun Kim more sensitive to demand-side pressures than com￾mercial newspapers. This is a reasonable assumption as government-controlled newspapers are no more re￾liant on reader demand than commercial newspapers, and readers of official newspapers are no more na￾tionalistic than those of commercial newspapers, as will be elaborated later in the section on different readership. Contrary to the first potential outcome, an empirical finding of greater bias in commercial newspapers would provide support for the second hy￾pothesis. In this case, the difference in the degree of bias would be attributable to demand-side pressures, given that commercial newspapers are no more subject to government pressure than government-controlled newspapers.7 EMPIRICAL STRATEGY Measuring Media Bias: News Coverage on Auto Recalls A key consideration in assessing the degree of me￾dia bias is to establish an objective benchmark for unbiased reporting. While it is relatively straightfor￾ward to compare newspapers’ favorability toward a given party, it is challenging to set up the standard by which a newspaper can be considered as biased and to what extent. Yet, establishing the standard is impera￾tive because this article aims to assess the degree of home bias exhibited by newspapers, rather than simply comparing their favorability toward domestic versus foreign firms. I address this challenge by examining a newspaper’s selective reporting behavior:How likely is a newspaper to cover the story when a similar type of negative or positive event affects a domestic versus a foreign firm? While an unbiased newspaper would be equally likely to cover negative or positive events involving domestic or foreign firms, a newspaper with a home bias might selectively omit coverage of negative events affecting domestic firms while covering positive events, and vice versa for foreign firms. It is worth emphasizing that the events that serve as a basis for comparison should be similar to each other. Otherwise, one cannot determine whether the difference in reporting pattern is due to bias or other characteristics of the events, unless they are adequately accounted for. Based on these considerations, I assess the degree of home bias by examining the frequency of news re￾porting devoted to domestic car recalls relative to for￾eign ones. Product recalls have obvious negative im￾plications for the quality of the products in question, and their characteristics are comparable across differ￾ent cases. A newspaper’s omission of such a negative 7 In either case, empirical support for a given hypothesis does not entirely rule out the possibility of the alternative factor. A find￾ing consistent with the first hypothesis would not necessarily imply the absence of demand-side influence, because commercial newspa￾pers may still exhibit bias, just to a lesser extent than government￾controlled newspapers. Similarly, empirical support for the second hypothesis would indicate limited government influence, but only relative to demand-side influence. event involving a certain party would indicate its bias toward that party. When a newspaper is found to dis￾criminate between domestic and foreign firms in its re￾porting of otherwise similar recall events, one can con￾sider it as evidence of bias. Auto recalls are particularly well suited to this study’s purpose because they happen frequently and get more media attention than other product recalls, allowing an empirical examination of reporting patterns over various time periods. I also ex￾amine the intensity and the tone of news reporting on auto recalls as supplementary measures. Empirical Scope: News Coverage by Chinese Newspapers I examine the degree of home bias exhibited by the Chinese news media. The empirical focus on China provides unique opportunities for exploring the sources of media’s home bias. Newspapers in China are under the varying degrees of government control, while operating within common economic, social and political environment. All newspapers in China are ul￾timately under state control, yet the degree of con￾trol varies substantially across newspapers. While of￾ficial newspapers are tightly controlled by party orga￾nizations, commercially oriented newspapers enjoy a greater space for news reporting than official papers (Stockmann 2013, 68–73).Also, the highly localized na￾ture of the Chinese news industry enables a subna￾tional comparison of news reporting. All regional gov￾ernments have their own official newspapers as well as commercial newspapers operating in their localities. These local governments differ in their level of inter￾ests in the automobile industry, which allows me to pin down the effects of governmental economic interests on news reporting. In essence, my empirical strategy has three basic components: I compare news coverage of auto re￾calls (1) by foreign versus domestic producers, (2) across official and commercial newspapers operating in the same province, and (3) across provinces with and without their own automotive state-owned enterprises (SOEs). By comparing news coverage of foreign ver￾sus domestic car recalls, I examine the effects of being foreign while controlling for the type of news content. Newspapers may vary with respect to the types of news content (e.g., hard news versus soft news), but I focus on one type of recall-related news and compare a given newspaper’s relative tendency to cover foreign versus domestic recalls.8 Further, I examine the effects of gov￾ernment influence by comparing official and commer￾cial newspapers. In so doing, I can effectively control for other national- or regional-level sources of bias be￾cause the sample includes both official and commer￾cial newspapers in the same province. Lastly, I compare 8 Even when a newspaper tends to report less on domestic recalls than other newspapers due to its focus on soft news than hard news, the newspaper is not considered as biased in my analysis as long as the newspaper does not discriminate domestic and foreign compa￾nies. The newspaper is considered as biased against foreign compa￾nies only when they report more on foreign recalls relative to domes￾tic recalls. 958 Downloaded from https://www.cambridge.org/core. Shanghai JiaoTong University, on 26 Oct 2018 at 03:53:05, subject to the Cambridge Core terms of use, available at https://www.cambridge.org/core/terms. https://doi.org/10.1017/S0003055418000242