Local newspapers related to good governance, new study finds

About 1300 communities across the US no longer have local news coverage. Furthermore, nearly 20 percent of all metro and community newspapers in the US have merged or gone out of business since 2004. Many more local newspapers have significantly scaled back coverage to the point that they’ve become known as “ghost newspapers.”

A new study suggests these trends in local journalism have financial implications for communities across the country. Without a local newspaper as watchdog on the beat, researchers at the Notre Dame and the University of Illinois at Chicago found that Wall Street firms are able to extract higher interest rates on municipal bonds. Their detailed economic study found a direct correlation between the drop in local news coverage and higher municipal bond rates. The evidence suggests that as newspapers close, the borrowing cost for local education, infrastructure, and hospital projects increase due to the lack of a local watchdog keeping an eye on local governance

Links:

The Hidden Costs of Losing Your City's Newspaper (CityLab, May 30, 2018)

Local Newspaper Closures Come With Hefty Price Tag For Residents  (NPR, Dec. 11, 2018)

About 1,300 U.S. communities have totally lost news coverage, UNC news desert study finds (Poynter, Oct. 15, 2018)

1300 communities across the US don’t have local news coverage (Speed Matters, Oct. 19, 2018)

Financing Dies in Darkness? The Impact of Newspaper Closures on Public Finance (Brookings, Jul 11, 2018)