The Effect of Content Moderation on Online and Offline Hate: Evidence from Germany's NetzDG

Abstract

Social media companies are under scrutiny for the prevalence of hateful content on their platforms, but there is scarce empirical evidence of the consequences of regulating such content. We study this question with a particular focus on anti-refugee hate crime in the context of the "Network Enforcement Act'' (NetzDG) in Germany, which mandates major social media companies to remove hateful posts within 24 hours. Using a difference-in-differences strategy, we find that the law was associated with a 4% reduction in the toxicity of refugee-related tweets by far-right social media users. Further, we show that the NetzDG reduced anti-refugee hate crimes in municipalities with more far-right social media users. The estimates suggest that the NetzDG induced a 0.9 percentage point reduction in anti-refugee incidents for every standard deviation of far-right social media usage. These findings are also confirmed by a synthetic control estimate. Together, these results suggest that online content moderation can curb online hate speech and offline violence.

Keywords: NetzDG, Hate Crime, Refugees, Germany

JEL Classification: L82, J15, O38