Truth, Lies, and Social Ties: When Image Concerns Fuel Fake News

TL;DR

This paper explores how social image concerns influence the sharing of true and false information, revealing that motives like appearing competent or signaling worldview can lead to increased false news sharing, with implications for information quality.

Contribution

It develops a theoretical model linking social image motives to information sharing behavior and derives testable predictions consistent with empirical observations.

Findings

False news can be shared more frequently than factual news under certain social motives.

Different social image motives lead to distinct sharing behaviors and welfare outcomes.

The model's predictions align with existing empirical evidence on fake news sharing patterns.

Abstract

We study how social image concerns shape information sharing among peers. Individuals receive a signal about a binary state of the world characterized by both a direction and a veracity status. While the direction is freely observable, verifying veracity is costly and depends on individual type. We consider two distinct social image motives: a desire to appear competent and a desire to signal one's worldview. For each motive, we characterize equilibrium sharing behavior and derive implications for the quality of shared information. We identify conditions under which false news is shared more frequently than factual news (e.g., Vosoughi et al., 2018). Both competence- and worldview-based motives can rationalize such patterns, though they yield empirically distinct sharing behaviors and different welfare implications. Finally, we derive testable predictions for each motive and discuss how these align with existing empirical evidence.