An Economic Theory of Disinformation

Taiji Harashima

MPRA Paper from University Library of Munich, Germany

Abstract: The impacts of misinformation and disinformation have rarely been studied in economics. In this paper, I examine these impacts using a model constructed on the basis of the concept of ranked information. The value of information is changeable and differs across people; therefore, disinformation can be used as a tool to manipulate people’s behaviors. I first define misinformation and disinformation and then show the mechanism through which disinformation decreases efficiency by manipulating ranked information. Decreases in efficiency are observed as decreases in total factor productivity, lowered success rates of investment, and increased costs of bad speculations. In addition, disinformation generates economic rents and, as a result, increases inequality, possibly by a great deal. Furthermore, disinformation can cause large-scale economic fluctuations.

Keywords: Disinformation; Economic fluctuation; Economic rent; Inequality; Misinformation; Ranked information (search for similar items in EconPapers)
JEL-codes: D24 D63 D72 D80 E32 (search for similar items in EconPapers)
Date: 2023-02-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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