Optimal Social Media Content Moderation and Platform Immunities

European Journal of Law and Economics, Vol. 50, No. 3, p. 437, 2020

16 Pages Posted: 28 May 2020 Last revised: 22 Jan 2021

See all articles by Frank Fagan

Frank Fagan

South Texas College of Law Houston; EDHEC Augmented Law Institute

Date Written: April 30, 2020


This Article presents a model of the lawmakers' choice between implementing a new content moderation regime that provides for platform liability for user-generated content versus continuing platform immunity for the same. The model demonstrates that lawmakers prefer platform immunity, even if incivility is increasing, if the costs of implementing a platform liability regime are greater than the costs of enforcing status quo law. In addition, inasmuch as implementation of a platform liability regime is coupled with new speech restrictions that are unconstitutional or prohibitively costly, lawmakers prefer immunity, but platforms are free to set strong content moderation policies consistent with existing law. Thus, the private governance function of platforms highlighted by Balkin and others is directly related to lawmakers' ability to enact and enforce alternatives, and further, it goes beyond mere private enforcement of existing free speech restrictions. Inasmuch as lawmakers are prohibited from suppressing unwanted speech by constitutional limits as well as lawmaking and enforcement costs, they give platforms wider discretion to make private suppression decisions. The status quo governance function of platforms, therefore, includes a private lawmaking function for determining which types of speech to suppress, albeit one bounded by the state’s appetite for alternatives.

Keywords: Social Media, Fake News, First Amendment, Section 230, Communications Decency Act

JEL Classification: K16, K23, K24, L82

Suggested Citation

Fagan, Frank, Optimal Social Media Content Moderation and Platform Immunities (April 30, 2020). European Journal of Law and Economics, Vol. 50, No. 3, p. 437, 2020, Available at SSRN: https://ssrn.com/abstract=3589189 or http://dx.doi.org/10.2139/ssrn.3589189

Frank Fagan (Contact Author)

South Texas College of Law Houston

1303 San Jacinto Street
Houston, TX 77002
United States

EDHEC Augmented Law Institute

Roubaix, 59057

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