Newspapers ’ market shares and the theory of the circulation spiral

Abstract

We consider a model of daily newspapers ’ competition to test the validity of the so called “theory of the circulation spiral”. According to it, the interaction between the newspapers and the advertising markets drives the newspaper with the smaller readership into a vicious circle, finally leading it to death. In a modelwith two newspapers, we show that, contrary to this conjecture, the dynamics envisaged by the proposers of the theory, does not always lead to the elimination of one of them