Lazarsfeld, Merton and Markets: Case Studies of Media Effects Theories As Applied to Financial Reporting and Financial Markets

The concept of "media effects" is a core tenet of communications research. Yet the degree of media influence or effect has been the subject of spirited debate among communications scholars for more than 50 years. Academic literature characterizes the media effects narrative as progressing in three distinct, if divergent stages pivoting on alternative notions of significant versus minimal effects before settling on a perspective the media could have strong effects, but only on certain individuals and in certain circumstances. Much of the media effects research to date has focused on the mass media's role as a primary site of political discourse in Western liberal democracies, the legacy media's role in symbol creation, and the implications of that symbol creation for the way society organizes itself politically. Yet the role of financial reporting and its effect on financial markets has been understudied. This dissertation extended the media effects question to consider whether mass media play a similar role in symbol creation in financial markets, and the implications of that constructed "reality."

This dissertation underscores a distinction in media effects analysis in the context of financial markets. A particular form of opinionation—the buying and selling of stocks—can occur in milliseconds and can be monetized by investors just as quickly. As a consequence, when elites use the news media as a communication channel to advance media relations strategies intended to generate particular news frames to drive market activity and impact the value of investment instruments, financial reporting can and does affect financial markets.