Ad-Valorem Taxes, Prices and Content Diversification in the News Market

In this paper, we look at two research questions. First, can lower ad-valorem taxes, on the selling of news and advertising, conduce to prices in media sector? Second, taxes stimulate firms increase diversity content that they offer? The purpose work is give tax political guidelines policy makers for sector. This important a sector has seen reduction payment subscriptions by readers (due competition from free Internet), advertisement revenues due giants like Google Facebook. With build Hoteling product model, which workhorse model economics. We show advertising are preferable because former newspaper. However, both reduces diversity, reduce use invest content.