Lost in Transmission

86 Pages Posted: 1 Feb 2024

See all articles by Thomas Graeber

Thomas Graeber

Harvard Business School

Shakked Noy

Massachusetts Institute of Technology (MIT)

Christopher Roth

University of Cologne

Multiple version iconThere are 2 versions of this paper

Date Written: 2024

Abstract

How does word-of-mouth transmission distort economic information? We pay participants to listen to audio recordings containing economic forecasts and accurately transmit the information through voice messages. Other participants listen to an original or a transmitted recording before stating incentivized beliefs. Across various transmitter incentive schemes, a forecast’s reliability is lost in transmission at a far higher rate than the forecast’s level. Reliable and unreliable information, once filtered through transmission, impact listener beliefs similarly. Mechanism experiments show that information about reliability is not perceived as less relevant or harder to transmit, but is less likely to come to mind during transmission.

Keywords: information transmission, word-of-mouth, narratives, reliability

Suggested Citation

Graeber, Thomas and Noy, Shakked and Roth, Christopher, Lost in Transmission (2024). CESifo Working Paper No. 10903, Available at SSRN: https://ssrn.com/abstract=4711260 or http://dx.doi.org/10.2139/ssrn.4711260

Thomas Graeber (Contact Author)

Harvard Business School ( email )

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Shakked Noy

Massachusetts Institute of Technology (MIT) ( email )

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Cambridge, MA 02139-4307
United States

Christopher Roth

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany

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