IDEAS home Printed from https://ideas.repec.org/p/alo/isipdp/24-03.html
   My bibliography  Save this paper

Persuasion in social media: smoke and mirrors

Author

Listed:
  • Prabal Roy Chowdhury

    (Indian Statistical Institute, Delhi)

Abstract

In the presence of individuals who think `categorically', we demonstrate that profit-maximizing social media platforms indulge in identity-based censoring, with nature of bias depending on the efficiency of the other epistemic institutions (EIs) of the society. In general, when the EIs are neither very efficient, nor very inefficient, the optimal strategy involves a mixture of confirmatory and (a minimal amount of) contrarian reporting, with the contrarian elements being used to create a false perception that no news is good news, which in turn allows the platform to camouflage the fact that it is suppressing all but one unwelcome signals. Further, public good implementation is inefficient if and only if the other epistemic institutions are inefficient.

Suggested Citation

  • Prabal Roy Chowdhury, 2024. "Persuasion in social media: smoke and mirrors," Discussion Papers 24-03, Indian Statistical Institute, Delhi.
    • Handle: RePEc:alo:isipdp:24-03
    as

    Download full text from publisher

    File URL: https://www.isid.ac.in/~epu/dispapers/dp24_03.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Markus K. Brunnermeier & Jonathan A. Parker, 2005. "Optimal Expectations," American Economic Review, American Economic Association, vol. 95(4), pages 1092-1118, September.
    2. Sendhil Mullainathan & Joshua Schwartzstein & Andrei Shleifer, 2008. "Coarse Thinking and Persuasion," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 123(2), pages 577-619.
    3. Jimmy Chan & Wing Suen, 2008. "A Spatial Theory of News Consumption and Electoral Competition," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 75(3), pages 699-728.
    4. Matthew Gentzkow & Jesse M. Shapiro, 2006. "Media Bias and Reputation," Journal of Political Economy, University of Chicago Press, vol. 114(2), pages 280-316, April.
    5. Matthew Gentzkow & Jesse M. Shapiro, 2010. "What Drives Media Slant? Evidence From U.S. Daily Newspapers," Econometrica, Econometric Society, vol. 78(1), pages 35-71, January.
    6. Gehlbach, Scott & Sonin, Konstantin, 2014. "Government control of the media," Journal of Public Economics, Elsevier, vol. 118(C), pages 163-171.
    7. Kfir Eliaz & Ran Spiegler, 2024. "News Media as Suppliers of Narratives (and Information)," Papers 2403.09155, arXiv.org.
    8. Hunt Allcott & Matthew Gentzkow, 2017. "Social Media and Fake News in the 2016 Election," Journal of Economic Perspectives, American Economic Association, vol. 31(2), pages 211-236, Spring.
    9. Daron Acemoglu & Munther A. Dahleh & Ilan Lobel & Asuman Ozdaglar, 2011. "Bayesian Learning in Social Networks," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(4), pages 1201-1236.
    10. Simon P. Anderson & John McLaren, 2012. "Media Mergers And Media Bias With Rational Consumers," Journal of the European Economic Association, European Economic Association, vol. 10(4), pages 831-859, August.
    11. Akerlof, George A & Dickens, William T, 1982. "The Economic Consequences of Cognitive Dissonance," American Economic Review, American Economic Association, vol. 72(3), pages 307-319, June.
    12. Ernst Fehr & Antonio Rangel, 2011. "Neuroeconomic Foundations of Economic Choice--Recent Advances," Journal of Economic Perspectives, American Economic Association, vol. 25(4), pages 3-30, Fall.
    13. T Renee Bowen & Danil Dmitriev & Simone Galperti, 2023. "Learning from Shared News: When Abundant Information Leads to Belief Polarization," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 138(2), pages 955-1000.
    14. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    15. Timothy Besley & Andrea Prat, 2006. "Handcuffs for the Grabbing Hand? Media Capture and Government Accountability," American Economic Review, American Economic Association, vol. 96(3), pages 720-736, June.
    16. George A. Akerlof & Rachel E. Kranton, 2000. "Economics and Identity," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 715-753.
    17. J. Duggan & C. Martinelli, 2011. "A Spatial Theory of Media Slant and Voter Choice," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(2), pages 640-666.
    18. Riccardo Puglisi & James M. Snyder Jr., 2015. "The Balanced Us Press," Journal of the European Economic Association, European Economic Association, vol. 13(2), pages 240-264, April.
    19. Steven Callander, 2011. "Searching and Learning by Trial and Error," American Economic Review, American Economic Association, vol. 101(6), pages 2277-2308, October.
    20. Baron, David P., 2006. "Persistent media bias," Journal of Public Economics, Elsevier, vol. 90(1-2), pages 1-36, January.
    21. Hunt Allcott & Matthew Gentzkow, 2017. "Social Media and Fake News in the 2016 Election," NBER Working Papers 23089, National Bureau of Economic Research, Inc.
    22. Norbert Schulz & Joachim Weimann, 1989. "Competition of newspapers and the location of political parties," Public Choice, Springer, vol. 63(2), pages 125-147, November.
    23. Botond Köszegi, 2006. "Ego Utility, Overconfidence, and Task Choice," Journal of the European Economic Association, MIT Press, vol. 4(4), pages 673-707, June.
    24. Jacopo Perego & Sevgi Yuksel, 2022. "Media Competition and Social Disagreement," Econometrica, Econometric Society, vol. 90(1), pages 223-265, January.
    25. Jeremy Burke, 2008. "Primetime Spin: Media Bias and Belief Confirming Information," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 17(3), pages 633-665, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ascensión Andina Díaz, 2011. "Mass Media in Economics: Origins and Subsequent Contributions," Working Papers 2011-02, Universidad de Málaga, Department of Economic Theory, Málaga Economic Theory Research Center.
    2. Miura, Shintaro, 2019. "Manipulated news model: Electoral competition and mass media," Games and Economic Behavior, Elsevier, vol. 113(C), pages 306-338.
    3. Edmond, Chris & Lu, Yang K., 2021. "Creating confusion," Journal of Economic Theory, Elsevier, vol. 191(C).
    4. Andina-Díaz, Ascensión & García-Martínez, José A., 2020. "Reputation and news suppression in the media industry," Games and Economic Behavior, Elsevier, vol. 123(C), pages 240-271.
    5. Federico Vaccari, 2023. "Influential news and policy-making," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 76(4), pages 1363-1418, November.
    6. Piolatto, Amedeo & Schuett, Florian, 2015. "Media competition and electoral politics," Journal of Public Economics, Elsevier, vol. 130(C), pages 80-93.
    7. Francesco Sobbrio, 2012. "A Citizen-Editors Model of News Media," RSCAS Working Papers 2012/61, European University Institute.
    8. repec:dgr:kubcen:2013072 is not listed on IDEAS
    9. Jacopo Perego & Sevgi Yuksel, 2022. "Media Competition and Social Disagreement," Econometrica, Econometric Society, vol. 90(1), pages 223-265, January.
    10. repec:tiu:tiucen:2013072 is not listed on IDEAS
    11. Piolatto, Amedeo & Schuett, Florian, 2015. "Media competition and electoral politics," Journal of Public Economics, Elsevier, vol. 130(C), pages 80-93.
    12. Petrova, Maria, 2012. "Mass media and special interest groups," Journal of Economic Behavior & Organization, Elsevier, vol. 84(1), pages 17-38.
    13. Sobbrio, Francesco, 2014. "Citizen-editors' endogenous information acquisition and news accuracy," Journal of Public Economics, Elsevier, vol. 113(C), pages 43-53.
    14. Junze Sun & Arthur Schram & Randolph Sloof, 2019. "A Theory on Media Bias and Elections," Tinbergen Institute Discussion Papers 19-048/I, Tinbergen Institute.
    15. Jun Hu, 2021. "Regulation of media bias on online newspapers," Working Papers hal-03120466, HAL.
    16. Julia Cage, 2017. "Media Competition, Information Provision and Political Participation: Evidence from French Local Newspapers and Elections, 1944-2014," SciencePo Working papers hal-03393164, HAL.
    17. Germano, Fabrizio & Sobbrio, Francesco, 2020. "Opinion dynamics via search engines (and other algorithmic gatekeepers)," Journal of Public Economics, Elsevier, vol. 187(C).
    18. Cagé, Julia, 2017. "Media Competition, Information Provision and Political Participation: Evidence from French Local Newspapers and Elections, 1944," CEPR Discussion Papers 12198, C.E.P.R. Discussion Papers.
    19. Andrea Prat, 2018. "Media Power," Journal of Political Economy, University of Chicago Press, vol. 126(4), pages 1747-1783.
    20. Ozerturk, Saltuk, 2022. "Media access, bias and public opinion," European Economic Review, Elsevier, vol. 147(C).
    21. Archishman Chakraborty & Parikshit Ghosh, 2016. "Character Endorsements and Electoral Competition," American Economic Journal: Microeconomics, American Economic Association, vol. 8(2), pages 277-310, May.
    22. David Strömberg, 2015. "Media and Politics," Annual Review of Economics, Annual Reviews, vol. 7(1), pages 173-205, August.

    More about this item

    Keywords

    social media; confirmation bias; contrarianism; identity-based censoring; categorical thinking;
    All these keywords.

    JEL classification:

    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:alo:isipdp:24-03. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Debasis Mishra (email available below). General contact details of provider: https://edirc.repec.org/data/isindin.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.