Finding our way through the maze of fake news and post-truth is only going to get harder. Not only in mainstream media and social networks, but specifically in scientific research and technological innovation. Here, here, here or here I have pointed to the increasing difficulty of telling facts apart from alt-facts.
In case you are wondering, this is not just an unintended consequence of increasing technological and social complexity. It is also the result of a deliberate effort made by the wealthy and influential. The value of ideas is usually downplayed but, make no mistake, politicians and business leaders know very well that ideas are the software running our minds, and they do not spare efforts to make sure our minds are running their latest version. Their weapon of mind destruction is the thought leader!
If the marketplace of ideas is flooded with cheerleaders for the next big thing, it is because that’s what billionaires want to hear.
What’s even worse is that economics can be on their side. In a new paper(1), Jonathan Berk and Jules H. van Binsbergen argue that for professions with a skill in short supply that is in high demand, neither information disclosure nor setting minimum standards improve consumer surplus. Hollow thinkers and charlatans seem a necessary evil:
We show that reducing the number of charlatans through regulation decreases consumer surplus. Although both standards and disclosure drive charlatans out of the market, consumers are worse off because of the resulting reduction in competition amongst producers.
Their model is worth a careful scrutiny (I have not done it!) In particular, they also conclude that producers strictly benefit from the regulation, implying that the regulation we observe in these markets likely derives from producer interests, which I very much doubt. But as they say, economic models are primarily a means to make a sound argument, and every effort to model the rise of bullshit should be applauded.
Linking the two references quoted above, I can see a clear picture: the thought leader is the digital transformation of the former oil snake charlatan!
(1) Berk, Jonathan and van Binsbergen, Jules H., Regulation of Charlatans in High-Skill Professions (June 24, 2017). Stanford University Graduate School of Business Research Paper No. 17-43. Available at SSRN: https://ssrn.com/abstract=2979134 or http://dx.doi.org/10.2139/ssrn.2979134