Social Media and Misleading Information in a Democracy: A Mechanism Design Approach
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In this paper, we present a resource allocation mechanism for the study of the strategic behavior of social media interacting with citizens that form opinions in a democracy. In a world of information and the internet, it becomes imperative for social media to filter misleading opinions on their platforms. As this is too altruistic to expect from different social media to self-enforce, we propose a mechanism design formulation that provides appropriate monetary incentives to social media leading to an efficient filter-wide system outcome. Our proposed mechanism incentivizes strategic social media to efficiently filter misleading information and thus indirectly prevent the ever-emergent phenomenon of fake news. In particular, we consider an economically inspired mechanism that designs an implementable Nash equilibrium of efficient filtering of misleading information in a game of selfish social media platforms. We also show that our mechanism is individual rational and budget balance, two key characteristics of a democratic society.
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