Clicks And Editorial Decisions: How Does Popularity Shape Online News Coverage? University of Toulouse 1 - Toulouse School of Economics (TSE) Pinar Yildirim University of Pennsylvania - The Wharton School July 2015 Abstract: Does the popularity of news stories influence the way editors allocate resources to them, and if so, how? With news available online, editors have the ability to track popularity or reader demand (i.e., the number of clicks) for individual stories. Using a unique online news dataset from a large Indian English daily newspaper, we provide evidence that editors indeed expand coverage of stories which receive more clicks. To establish a causal link between clicks and coverage, we use a novel instrumental variables strategy exploiting rainfall and power outages as exogenous shocks to reader access to online news. Further, we find that the newspaper responds asymmetrically across different types of news stories by giving additional coverage based only on the higher clicks received by 'hard' news stories. We provide evidence for 'hard' news crowding out 'soft' news and not vice-versa. Moreover, we relate our results to firm strategy and the inability of firms to handle 'big data'. Clicks And Editorial Decisions: How Does Popularity Shape Online News Coverage? - Introduction On the 7th of January 2015, a terrorist attack on the satirical newspaper Charlie Hebdo resulted in the deaths of 12 people in Paris. In the days that followed, the event dominated news headlines around the world. On the same day... More