Monday, February 07, 2005


Media Logic (Churchill = Kerik)

Media logic, and how it is oh so easy/hard.
Start off with an easy Principal-agent theory.
Take seemingly any big piece of news out of the newspaper. Backtrack the story to its source. Try to go as far back as possible.

Theory > all stories have an origin that depends on marginal utility. all media outlet will determine their behavior according to risk-strategies (not necessarily Pareto-optimal levels).

If we follow the Kerik scandal and the evolution of the reports about Churchill they appear to take off in the same way (one, or a few sources start off on one single issue that is later being connected to various other related or non-related issues).
But if the theory of media logic is worth anything it should take into account the marginal utility involved in leaking these stories to the press, and the risk for printing them.
In Kerik's case - following Memogate and CBS's embarrasment - the risk involved is high. Any misleading paragraph in a paper might backfire on the media outlet. In Churchill's case the risk is virtually zero.

The fact that the two media scenarios evolve in the same way (fast, with a widespread amount of news outlets bringing out the same message) the situation for both Churchill and Kerik are the same in terms of retaliation. It is hard, not to say impossible, at least initially.


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