Skepticism and Credulity: A Model and Applications to Political Spin, Belief Formation, and Decision Weights

Campbell James David ()
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Campbell James David: Providence College, 02918-7000 Providence, RI, USA

The B.E. Journal of Theoretical Economics, 2022, vol. 22, issue 2, 329-367

Abstract: In this paper I model a decision maker who forms beliefs and opinions using a dialectic heuristic that depends on their degree of skepticism or credulity. In an application to political spin, two competing parties choose how to frame commonly observed evidence. If the receiver is sufficiently credulous, equilibrium spin is maximally extreme and generates short, superficial news cycles. When receivers vary in their skepticism, there is partisan sorting by skepticism parameter: the more credulous group systematically favors one party and displays hostility to evidence and a media they see as biased. In behavioral applications in which the frames arise from the decision maker’s internal deliberation, a decision maker with the same credulous nature would display known behavioral anomalies in forming beliefs and forming decision weights from stated probabilities. The dialectic model therefore captures a simple psychological mechanism and matches closely some stylized facts across these three disparate applications.

Keywords: belief formation; credulity; persuasion; political spin; skepticism; subjective probability (search for similar items in EconPapers)
JEL-codes: D72 D81 D83 D91 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1515/bejte-2019-0184

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