Mechanisms of liberal bias in the news media versus the academy.

• Author: Sutter, Daniel

Ideas exert immense influence on life, as observed by thinkers as diverse as John Maynard Keynes and Ayn Rand. Modern models of democratic politics incorporate the citizens' policy preferences, but the available ideas in society ultimately shape these preferences and the citizens' views of how policies affect outcomes. In the long run, the market for ideas significantly affects economies.

The market for ideas and information has two segments: the generation of ideas and the transmission of these ideas to the general public. Ivory tower academics and the news media arc important components of the market for ideas. Given the influence of ideas on policy, it is not surprising that many observers have expressed concern over the apparent left-liberal bias in both the media and the academy favoring greater government direction of society:

Journalism is inherently subjective; a journalist's approach to a story invariably reflects his opinions. No one would accept the statement of a Ku Klux Klansman, in line for a judgeship, that he was capable of applying the civil rights laws objectively, without regard to his personal opinions. Yet the argument is advanced by members of the media that a reporter can cover

George Bush fairly even if he believes that Bush is a tool of fascist warmongers and racist plutocrats. (Bozell and Baker 1990, 1)

[P]art of what really bothers so many liberals ... is that there even exists a more conservative alternative to the mainstream news outlets. Liberals ... had the playing field to themselves for so many years, controlling the rules of the game, that to them it had come to seem the natural order of things. (Goldberg 2003, 12)

With a few notable exceptions, most prestigious liberal arts colleges and universities have installed the entire radical menu at the center of their humanities curriculum at both the graduate and undergraduate levels. Every special interest ... and every modish interpretive gambit ... has found a welcome roost in the academy, while the traditional curriculum and modes of intellectual inquiry arc excoriated as sexist, racist, or just plain reactionary. (Kimball 2008, 5)

The radical cohort ... is now a large and influential presence and in some cases an imposing majority on liberal arts faculties and the governing bodies of national academic organizations. As a result, it has been able to transform significant parts of the academy into agencies of political and social change. (Horowitz and Laskin 2009, 9)

Political bias in the market for ideas is in essence a claim concerning the performance or efficiency of this market. Concerns about left-liberal bias among intellectuals arc not new; Ludwig von Mises ([1956] 1972), Friedrich Hayek (1960), and Robert Nozick (1998) discussed this topic. (1)

The available evidence clearly establishes that more journalists and academics in the United States are Democrats or liberals than Republicans, conservatives, or libertarians (Lichter, Rothman, and Lichter 1986; Weaver and Wilhoit 1996; Cardiff and Klein 2005; Klein and Stern 2005) and that this disparity of numbers may affect the substance of research, writing, and teaching (Groseclosc and Milyo 2005; Kimball 2008; Horowitz and Laskin 2009; Gentzkow and Shapiro 2010). Yet such evidence is the equivalent of circumstantial evidence in criminal proceedings and not totally satisfying. Work product, for instance, may not reflect political views; both journalists and academics employ methods designed to keep personal views out of their work. Positions on specific issues also depend on the facts. News stories that take global warming as a fact and research by health economists in support of government-run health care are not necessarily biased; without independent access to the "truth," we can never demonstrate biased misrepresentation of the truth by news coverage or academic research. An examination of the news industry's and the academy's institutions and incentives therefore usefully supplements the available evidence. In other words, discovery of a compelling motive can make circumstantial evidence look much stronger.

In this article, I present a comparative institutional analysis of news reporting and the academy to help provide perspective on charges of bias in each sector. Three differences appear significant. The first is in the nature of the marketed product. The media markets news to a general audience, generating revenue either directly through audience payment or indirectly through advertising. Either way, attracting customers is closely tied to revenue generation. In contrast, academics produce student credit hours and research reports consumed primarily by other academics. Neither product results in substantial feedback in the form of revenue from the larger society. The second difference is the nature of employee compensation. On-the-job consumption in various forms seemingly constitutes a larger share of professors' total compensation. If bias in research and teaching were to reduce universities' revenues, this reduction would be offset by professors' lower monetary compensation. The third difference is the lack of a residual claimant for nonprofit private or public universities compared with private ownership of the media. Although the lack of a profit motive might be thought to be the major difference between the sectors, its effect is primarily to increase the persistence of bias when or if it develops. The lack of a residual claimant reduces the likelihood of radical measures to overhaul a poorly performing, bias-ridden university department. The lack of a profit incentive can combine with the almost nonexistent revenue effect to create scope for administrators to indulge bias or other prejudices in hiring. (2)

News Media Bias

The news media market a product, whether it be a newspaper, a magazine, a TV broadcast, or Web site material. The media in the United States (and now in most countries around the world) are privately owned for-profit companies with residual claimants. The owners' interest limits the potential for liberal bias if this bias reduces the audience for news. A liberal bias across most or all outlets in a segment of the news market will likely result in lower revenues, owing to alienation of conservatives and libertarians and a division of the remaining audience (Sutter 2001). The reduced revenues can result either directly through reduced consumer purchases or indirectly through lower advertising rates. The reduction in profits at some point will provoke action by the owners to limit bias. Managers need not be perfect agents of owners, and owners may not respond immediately, but lost revenues and profits will eventually provoke action by owners to control a liberal news bias.

Two factors can offset news owners' incentive to limit bias. First, liberal news may not significantly reduce the audience, either because consumers fail to discern the bias or because potential consumers are disproportionately liberal (Goff and Tollison 1990) or because a left-liberal orientation makes for more interesting and marketable stories (Sutter 2004). Many news consumers may be unable to detect partisan bias in a story or unaware of alternative potential stories or angles. Customer preferences explain bias only if liberal news produces a greater audience than unbiased news, and if we are to explain bias across most or all media outlets, the audience must be extremely liberal; if there are three news outlets, moderates and conservatives cannot make up more than one-third of the news audience (under standard assumptions of a spatial model) for all three outlets to maximize revenue by supplying liberal news. Bias that does not adversely affect the audience might be regarded as benign, but this conclusion is not necessarily correct. By affecting the information that news consumers receive, hidden bias can affect voters' policy preferences on specific issues.

Second, bias can potentially reduce costs. The most likely means by which biased reporting lowers cost is if liberal reporters value indulging bias in their work. If reporters accept lower salaries in order to report with a liberal bias, or, alternatively, if news organizations have to pay a compensating wage differential for neutral or conservative reporting, bias can lower cost and potentially offset any loss in revenue. The prevalence of liberals among the ranks of reporters provides plausibility to the compensating-wage-differential hypothesis. But although surveys consistently reveal that more journalists self-identify as liberal than as conservative, typically fewer than 50 percent of reporters identify themselves as liberal. (3) Thus, the median reporter does not appear extremely liberal, which should limit the size of the wage differential. In addition, many journalists also value being good reporters, which involves reporting the news without bias.

A force exists to limit bias in the news media: the incentive of owners of for profit news companies and entrepreneurs who might exploit an opportunity to provide unbiased or conservative news. Thus, liberal bias in the commercial news media provokes its own reaction as long as bias eventually reduces revenues and profits. The response need not be perfect, but the greater the bias, the greater the reduction in profit and the greater the likelihood that owners will respond.

How the Academy Differs

The academy differs from the news market in three main ways. First, the vast majority of colleges and universities comprises either nonprofit organizations or public (or quasi-public) enterprises. Therefore, universities have no residual claimant to benefit from correcting bias that hurts organizational performance. Second, academics do not produce a product sold directly on the market, and hence there is no representative audience that might be alienated by a biased product, as in the case of news reports. Liberal bias produces much weaker feedback for a...