Definition of 'CNN Effect'
A theory that seeks to explain the effect that 24-hour news networks, such as CNN, have on the general political and economic climate. Because media outlets provide ongoing coverage of a particular event, or subject matter, the attention of viewers is narrowly focused for potentially prolonged periods of time. The CNN effect can therefore cause individuals and organizations to react more aggressively towards the subject matter being examined. For example, regular coverage of turmoil in the banking sector may result in the Federal Reserve taking the necessary action to minimize any potential detrimental effects.
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