Fake News: Susceptibility, Awareness and Solutions

Abstract:

This paper quantifies the effect of a demand-side policy intervention to increase citizens’ willingness to pay to protect themselves from misinformation. We find that the average citizen lacks proficiency in identifying fake news and harbors an inflated perception of his/her ability to differentiate between accurate and fake news content. Increasing awareness by providing information about personal susceptibility to fall for fake news causally adjusts individuals’ beliefs about their fake news detection ability. Most importantly, we show that informing citizens about their personal susceptibility to fall for fake news causally increases their willingness to pay for the fact-checking service.