Gerard Padro i Miquel (Yale), "Competitive Capture of Public Opinion"
We propose a general equilibrium model where two lobbies (right and left) compete to influence public opinion. Citizens with heterogeneous priors over a binary state of the world receive information from a variety of sources, and the two opposite lobbyists attempt to push their own agenda (one lobby to persuade citizens towards one state of the world, the other towards the alternative state of the world) by capturing the content of these sources. We characterize the equilibrium level of capture of each source by competing lobbyists as well as the equilibrium level of information transmission. We show that lobbying activity makes extreme messages become more prevalent. As a consequence, rational citizens discount such extreme reports. It follows that opposite capturing efforts do not cancel each other and instead result in a social loss in learning. We also show that efforts to capture a given information source are strategic substitutes: citizens' skepticism of messages favoring the view of the lobby that is expected to capture that source dampen the incentives of the opposite lobby. Strategic substitution exacerbates horizontal differentiation: small advantages for one lobby are amplified within source, so information sources become more ideological, and also amplified across sources, so the information landscape becomes populated by left-leaning and right-leaning outlets. We show that in this framework we can distinguish between lobbies whose capturing effort is about firing up the base (radicalizing those with priors favorable to the lobby) and lobbies who mostly want to mollify the opposition (moving those with opposite views towards moderation). We explore how citizens endogenously choose which information source to consume and show that increased demand for information when lobbies want to fire up the base can exacerbate differentiation and reduce information transmission in equilibrium.
Co-sponsored by FAS and IQSS, the Alberto Alesina Seminar on Political Economy supports research-related activities that integrate the study of economics and politics, whether by studying economic behavior in the political process or political behavior in the marketplace. In general, positive political economy is concerned with showing how observed differences among institutions affect political and economic outcomes in various social, economic, and political systems and how the institutions themselves change and develop in response to individual and collective beliefs, preferences, and strategies.
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LOCATION:CGIS Knafel, room K354 STATUS:CONFIRMED DTSTART:20230420T203000Z DTEND:20230420T214500Z END:VEVENT END:VCALENDAR