In this work we study the coupled dynamics of social balance and opinion formation. We propose a model where agents form opinions under bounded confidence, but only considering the opinions of their friends. The signs of social ties -friendships and enmities- evolve seeking for social balance, taking into account how similar agents’ opinions are. We consider both the case where opinions have one and two dimensions. We find that our dynamics produces the segregation of agents into two cliques, with the opinions of agents in one clique differing from those in the other. Depending on the level of bounded confidence, the dynamics can produce either consensus of opinions within each clique or the coexistence of several opinion clusters in a clique. For the uni-dimensional case, the opinions in one clique are all below the opinions in the other clique, hence defining a “left clique” and a “right clique”. In the two-dimensional case, our numerical results suggest that the two cliques are separated by a hyperplane in the opinion space. We also show that the phenomenon of unidimensional opinions identified by DeMarzo, Vayanos and Zwiebel (Q J Econ 2003) extends partially to our dynamics. Finally, in the context of politics, we comment about the possible relation of our results to the fragmentation of an ideology and the emergence of new political parties.

The aim of this paper is to analyze competition between two ideological media outlets that want to influence their viewers so as to boot the number of votes for their preferred political party. We consider two ways of influencing viewers, which correspond to two prominent theories borrowed from the literature on Sociology: the “Reinforcement Approach” and the “Attitudinal Orientations Approach”. Our findings show that the aim of influencing viewers generally pushes media outlets to differentiate their opinions, and that the extend of this differentiation deeply depends on the viewers’ behavior. More precisely, we observe that if the viewers channel hop, media outlets end up differentiating their opinions more than if the viewers receive all their information from just one media. Copyright Springer Science+Business Media, LLC 2007Ideological media, Influence, Channel hopping,

This paper proposes a new argument to explain why media firms silence information that may be relevant to consumers and why this behavior varies across firms. We build on the literature of career concerns and consider firms that seek to maximize their reputation for high quality. Crucial to our results is the idea that media firms can affect, with their reporting strategy, the probability that consumers learn the true state. Reputational concerns dictate that a monopoly firm suppresses scoops, even when evidence is strong. With competition, precise private information is published but weaker though informative signals are silenced. We obtain that silence is higher in media firms with high levels of initial reputation and/or great social influence. We draw predictions on a firm's optimal choice of an editorial standard, the persistence of news suppression when consumers believe one state to be more likely than another and the possibility that silence may be socially beneficial.

This paper studies the location decisions of political parties. We propose a game where agents vote according to ideology and valence, and media create candidates’ charisma. The results we obtain show that candidates realize the power of media and therefore, locate themselves at some point between the position of the median voter and that of the media. We further obtain that depending on the media outlets the voters choose to see, the equilibrium location of candidates may differ. Thus, when voters choose among the outlets, candidates may differentiate their platforms. Differently, when voters are exposed to all the outlets, candidates tend more to moderate their ideology, in an attempt to get the favor of all the media. Copyright Springer Science + Business Media, Inc. 2006

This paper analyzes an election game where self-interested politicians can exploit the lack of information that voters have about candidates' preferred policies in order to pursue their own agendas.In such a setup, we study the incentives of newspapers to acquire costly information, and how competition among the media affect such incentives. We show that the higher the number of potential readers and/or the lower the cost or investigating, the more the newspapers investigate. We also show that the readers' purchasing habits play a crucial role in the model. More specifically, we show that if the readers always buy a newspaper, media competition favors information disclosure; whereas if they just buy a newspaper in the case news are uncovered, competition is not so desirable. JEL classification: D72; D82