Homophily in Social Media and News Polarization

Résumé

We consider an ad-financed media firm that chooses the ideological location of its news when consumers who directly receive the news can share it with their followers on social media. When the firm maximizes the breadth of news sharing, it tends to produce polarized news if the mean (the variance) of ideological locations of the followers of a direct consumer is a convex (concave) function of the latter’s location. This implies that it is the curvature, rather than the slope, of homophily that determines news polarization so that surprisingly, larger homophily at the center (extremes) can lead to (no) polarization.