Information Cocoons on Social Media: Why and How Should the Government Regulate Algorithms

TL;DR

This paper analyzes the causes and implications of information cocoons on social media, emphasizing the need for regulation through nudges to promote diversity while maintaining freedom of choice.

Contribution

It provides a behavioral perspective on why social media algorithms foster information cocoons and proposes libertarian paternalism as a regulatory approach.

Findings

Algorithm-based social media increases ideological segregation

Information diversity is crucial for a sustainable information environment

Nudges can address core issues while preserving freedom of choice

Abstract

Information cocoons are frequently cited in the literature on whether and how social media might lead to ideological segregation and political polarization. From the behavioural and communication perspectives, this paper first examines why algorithm-based social media, as opposed to its traditional counterpart, is more likely to produce information cocoons. We then explore populism and short-termism in voting, bias and noise in decision-making, and prerequisite capital for innovation, demonstrating the importance of information diversity for a sustainable information environment. Finally, this study argues for libertarian paternalism by evaluating the criteria and trade-offs involved in regulating algorithms and proposes to employ nudges to address the core issues while preserving freedom of choice.