APPLIED MICRO: Social Media and Government Responsiveness: Evidence from Vaccine Procurement in China; Professor Yanhui WU (University of Hong Kong)

Abstract

This paper studies whether and how public opinion on social media affects local governments' procurement of vaccines in China during 2014-2019. To establish causality, we exploit city-level variation in the eruption of social-media opinion on vaccine safety, instrumented by quasi-random penetration of social media during the early stage. We find that governments in cities exposed to stronger information shocks increased the share of more-transparent procurement and reduced home bias by procuring more vaccines from nonlocal and foreign producers. The effect is strong even if social media posts only contain coarse and sentimental information; it disappears when public opinion does not target the government. The effect is larger in cities where local officials have stronger career concerns and where preexisting political information is scarcer. Our findings show that, in nondemocracies, social media can pressure local governments to respond to public needs in areas where the regime and public share common interests.