Small companies that don’t get a lot of media attention benefit from the biggest financing boosts when they do receive coverage, a Bank of Canada research paper found. Reallocating five to 10 per cent of media coverage towards such companies could make them significantly more efficient, benefiting the economy as a whole, according to the authors. (The Logic)

Talking point: The research paper examines how media coverage of companies, a major source of information for investors, affects investment decisions. The authors found companies tend to increase equity financing and investment after receiving news coverage, but the companies that need this boost least are the most likely to receive it, since journalists typically consider large companies more newsworthy. The authors built an economic model to simulate the effects of a hypothetical marketplace in which companies would be able buy media coverage, finding such a system would boost efficiency at small firms.