FINTECH THRUST SEMINAR | Does Fake News Create Echo Chambers?
Does Fake News Create Echo Chambers?
Abstract:
Platforms have come under criticism from regulatory agencies, policymakers, and media scholars for the unfettered spread of fake news online. A key concern is that, as fake news becomes prevalent, individuals may fall into online “echo chambers” that predominantly expose them only to fake news. Using a dataset reporting 30,995 users' online activity, we empirically examine the reach of false news content and whether echo chambers exist. We find that the population is widely exposed to online false news. However, echo chambers are minimal, and the most avid readers of false news content regularly expose themselves to mainstream news sources. Using a natural experiment occurring on a major social media platform, we find that being exposed to false news content causes users to increase their exposure to countervailing mainstream news (by 9.1% in the experiment). Hence, a naive intervention that reduces the supply of false news sources on a platform also reduces the overall consumption of news. Based on a structural model of user decisions whether to diversify their online news sources, we prescribe how platforms should moderate false news content. We find that platforms can further reduce the size of echo chambers (by 12-18\%) by focusing their content moderation efforts on the users that are most susceptible to consuming predominantly false news, instead of the users most deeply exposed to false news.
Jiding Zhang is an Assistant Professor of Information Systems at W. P. Carey School of Business, Arizona State University. She is passionate in applying and developing data science tools to solve novel challenges in business. Combining causal inference and machine learning methods, her work provides practical insights and recommendations for FinTech, platform governance, and media in the digital age. Jiding obtained her Ph.D. degree from the Operations, Information and Decisions Department of The Wharton School. Prior to joining ASU, she was an Assistant Professor at NYU Shanghai.