Fake News, Voter Overconfidence, and the Quality of Democratic Choice†

This paper studies , theoretically and experimentally , the effects of overconfidence and fake news on information aggregation and the quality of democratic choice in a common-interest setting. We theo-retically show that overconfidence exacerbates the adverse effects of widespread misinformation (i.e. , fake news). We then analyze richer models that allow for partisanship , targeted misinformation intended to sway public opinion , and news signals correlated across voters (due to media ownership concentration or censorship). In our exper-iment , overconfidence severely undermines information aggregation , suggesting that the effect of overconfidence can be much more pro-nounced at the collective than at the individual level. (JEL C91, D12, D72, D82, D83, L82)