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Electoral Competition with Fake News

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  • Gene M. Grossman
  • Elhanan Helpman

Abstract

Misinformation pervades political competition. We introduce opportunities for political candidates and their media supporters to spread fake news about the policy environment and perhaps about parties' positions into a familiar model of electoral competition. In the baseline model with full information, the parties' positions converge to those that maximize aggregate welfare. When parties can broadcast fake news to audiences that disproportionately include their partisans, policy divergence and suboptimal outcomes can result. We study a sequence of models that impose progressively tighter constraints on false reporting and characterize situations that lead to divergence and a polarized electorate.

Suggested Citation

  • Gene M. Grossman & Elhanan Helpman, 2019. "Electoral Competition with Fake News," NBER Working Papers 26409, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:26409
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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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