Studies show a negative bias in U.S. coverage of the economy and gas prices, particularly cable news, as the tone of economic news moves away from reality, reports John Burn-Murdoch of the Financial Times.
Burn-Murdoch writes, “Data from the US Federal Reserve shows the same tell-tale pattern we have grown used to with crime: people assess their own financial situation to be relatively healthy, and this changes very little from year to year, but their assessment of the national economy has cratered, opening up a huge gulf. It seems increasingly likely news coverage shoulders part of the blame.
“One study this year found that even as recessions have become far fewer and further between over the last century, news articles written about the economy have been more and more downbeat. Another found that the tone of economic news has further decoupled from the fundamentals in recent years, beginning in 2018, meaning this cannot just be about the pandemic or the recent bout of inflation.
“The latest piece of the evidence comes from Ryan Cummings, Giacomo Fraccaroli and Neale Mahoney, a trio of economists writing for the US economics publication Briefing Book, whose analysis of 1mn transcripts from six US broadcasters demonstrates a striking negativity bias when it comes to reporting petrol prices. This is particularly important given the formative role these prices have on consumer sentiment more broadly.”
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