This paper studies whether and how public opinion on social media affects local governments’ procurements of vaccines in China from 2014 to 2019. To identify causal effects, we exploit the regional variation in public opinion induced by explosive online attention to vaccine issues following sudden vaccination scandals, controlling for preexisting differential trends. We find that abrupt increases in public opinion on social media led local governments to increase the frequency and share of the more-transparent (open-bidding) format of procurements for vaccine-related products. The effects are stronger when we use early-stage social media penetration in China as an instrumental variable. However, the effects are short-lived and are absent when a scandal did not spike social media discussion. Interestingly, the effects are present when an accident caused upsurges in social media response. Our overall findings shed light on the mechanisms and limitation regarding the effect of social media on government accountability.
Yanhui Wu is Associate Professor of Economics at the University of Hong Kong and Research Fellow of the Centre for Economic Policy Research (CEPR). Prior to HKU, he taught at the Marshall School of Business (USC) after he received his doctoral degree (in economics) from the London School of Economics in 2011. His research concentrates on media economics and organizational economics with a focus on the Chinese context. Recently, he has worked with data scientists to apply cutting-edge big data methods to various areas in the social sciences. His work has been published at top academic journals, including the American Economic Review, Review of Economics and Statistics, Economic Journal, Journal of Economic Perspectives, Journal of American Statistical Association, Management Science, and Organization Science.
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