Defamation with Bayesian Audiences

34 Pages Posted: 9 Aug 2022 Last revised: 20 Nov 2023

See all articles by Yonathan A. Arbel

Yonathan A. Arbel

University of Alabama - School of Law

Murat C. Mungan

Texas A&M University School of Law

Multiple version iconThere are 2 versions of this paper

Date Written: August 4, 2022

Abstract

How strictly should the law regulate false defamatory statements? We first show that the presence of judicial errors often puts defamation law on a Laffer curve: regulation that is too lax or too strict is inferior to moderate regulation. While moderate regulation is ideal, it is not always attainable, due to practical and legal constraints. With these constraints, the presence of Bayesian audiences can cause the optimal regulation to be laxer than is prescribed by standard models with naïve audiences. This highlights the importance of accounting for the impact of defamation laws on belief formation.

Keywords: Defamation, Bayesian audience, information regulation, disclosure, libel, slander

JEL Classification: C72, D82, D83, K10, K13, K39

Suggested Citation

Arbel, Yonathan A. and Mungan, Murat C., Defamation with Bayesian Audiences (August 4, 2022). Journal of Legal Studies, Vol. 52, 2023, Texas A&M University School of Law Legal Studies Research Paper No. 23-66, Available at SSRN: https://ssrn.com/abstract=4181890

Yonathan A. Arbel (Contact Author)

University of Alabama - School of Law ( email )

P.O. Box 870382
Tuscaloosa, AL 35487
United States

Murat C. Mungan

Texas A&M University School of Law

1515 Commerce St.
Fort Worth, TX Tarrant County 76102
United States

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