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Evidence on the effects of mandatory disclaimers in advertising

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  • Green, Kesten C.
  • Armstrong, J. Scott

Abstract

We found no evidence that consumers benefit from government-mandated disclaimers in advertising. Experiments and common experience show that admonishments to change or avoid behaviors often have effects opposite to those intended. We found 18 experimental studies that provided evidence relevant to mandatory disclaimers. Mandated messages increased confusion in all, and were ineffective or harmful in the 15 studies that examined perceptions, attitudes, or decisions. We conducted an experiment on the effects of a government-mandated disclaimer for a Florida court case. Two advertisements for dentists offering implant dentistry were shown to 317 subjects. One advertiser had implant dentistry credentials. Subjects exposed to the disclaimer more often recommended the advertiser who lacked credentials. Women and less-educated subjects were particularly prone to this error. In addition, subjects drew false and damaging inferences about the credentialed dentist.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 37766.

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Date of creation: 30 Mar 2012
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Handle: RePEc:pra:mprapa:37766

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Keywords: consumer protection; corrective advertising; decision making; government regulation; judgment;

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References

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  1. Mathios, Alan D, 2000. "The Impact of Mandatory Disclosure Laws on Product Choices: An Analysis of the Salad Dressing Market," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 651-77, October.
  2. Maheshri, Vikram & Mannering, Fred & Winston, Clifford, 2006. "An Exploration of the Offset Hypothesis Using Disaggregate Data:The Case of Airbags and Antilock Brakes," Working paper 155, Regulation2point0.
  3. Clifford Winston, 2008. "The Efficacy of Information Policy: A Review of Archon Fung, Mary Graham, and David Weil's Full Disclosure: The Perils and Promise of Transparency," Journal of Economic Literature, American Economic Association, vol. 46(3), pages 704-17, September.
  4. Steven M. Shugan, 2006. "Editorial: Who Is Afraid to Give Freedom of Speech to Marketing Folks?," Marketing Science, INFORMS, vol. 25(5), pages 403-410, September.
  5. JS Armstrong, 2004. "Peer Review for Journals: Evidence on Quality Control, Fairness, and Innovation," General Economics and Teaching 0412027, EconWPA.
  6. Ippolito, Pauline M & Mathios, Alan D, 1995. "Information and Advertising: The Case of Fat Consumption in the United States," American Economic Review, American Economic Association, vol. 85(2), pages 91-95, May.
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Cited by:
  1. Armstrong, J. Scott & Green, Kesten C., 2013. "Effects of corporate social responsibility and irresponsibility policies," Journal of Business Research, Elsevier, vol. 66(10), pages 1922-1927.

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