Winning the Hardware Software Game book Winning the Hardware-Software Game

Using Game Theory to Optimize the Pace of New Technology Adoption

Innovators of new technology systems requiring users to combine both hardware and software components often face delays in adoption of their new systems.  Users will not buy the hardware until enough software or content is available, while at the same time software providers will not provide content until enough users have adopted the new system.  This book examines the dynamics of this adoption process and provides methods for optimizing the pace of adoption of new technology systems.     Read more...

“Fake News” has become one of the big afflictions of our times. I just Googled the phrase “fake news,” and it generated 174 million hits. No one seems to know anymore whether or not any reported information is true and/or accurate. This has led people to question the truth of everything, particularly if they don’t like what’s been reported.

Trust in mass media as a whole is declining rapidly across the board. In 1976, 72% of the population had either a great del or a fair amount of trust in mass media. By 2016, that figure had declined to 32%. From Art Swift, “Americans' Trust in Mass Media Sinks to New Low” (and see Figure 1)

Americans' trust and confidence in the mass media "to report the news fully, accurately and fairly" has dropped to its lowest level in Gallup polling history, with 32 saying they have a great deal or fair amount of trust in the media. This is down eight percentage points from last year.

Gallup began asking this question in 1972, and on a yearly basis since 1997. Over the history of the entire trend, Americans' trust and confidence hit its highest point in 1976, at 72 ...

Figure 1

1 trust media 

Access to true and accurate reporting of news and information is pivotal for justice and democracy to prevail. Yet, it’s become extremely difficult to ferret out the truth from news and information reports. How can we address this problem? That is, how do we encourage people to report complete and accurate information?

Subject Matters and Categories

The term “fake news” has been used to characterize several different types of information reports on a variety of subject matters, including:

  • Politics: Election results, proposed policies, indiscretions, etc.
  • Business: Profitability, M&A activity, sustainability, etc.
  • Science: Findings reported from health and science studies.
  • Social Matters: Celebrity information, etc.

The inaccurately reported information on these subject matters generally falls into one or more of the following categories:

1.  Premature: The information is (unintentionally) inaccurate, due to being provided before all the facts have become available. The reporter wants to be the first to report the news, but doing so causes him to release information before all the facts are in.

2.  Sloppy: The information is (unintentionally) inaccurate, due to sloppy reporting, where the reporter doesn’t spend the time or make the effort to check facts or collect all the relevant information. The reporter wants to minimize his effort, but by neglecting to check the facts or do a thorough job, his report ends up being inaccurate and/or incomplete.

3.  Biased: The information is (unintentionally or intentionally) inaccurate (e.g., information is reported out of context), because the reporter is consciously or subconsciously biased (trying to minimize cognitive dissonance) or trying to signal belonging.

4.  Propaganda: The information is intentionally inaccurate, because the reporter is trying to promote an agenda.

5.  Sensationalized: The information is intentionally fake or sensationalized, because the reporter is trying to generate as many views as possible.

 

Benefits and Costs of Reported Information

Consider the benefits and costs to reporters from reporting accurate versus inaccurate information.

If they report accurate information, then reporters reap the benefits associated with that reporting (e.g., money or recognition), but they also incur the costs (e.g., time and effort) of doing so:

(1)  Net Benefit(Accurate)

= Benefit(Accurate) –  Cost(Accurate)

Conversely, if they report inaccurate information but pass it off as being accurate, then they get the benefits associated with reporting accurate information (e.g., money, or recognition), but they incur the directs costs (e.g., time and effort) of providing the inaccurate information. If reporters are trying to short-change their effort, then presumably the costs of reporting inaccurate information are lower than the costs they would incur to do the job right. However, reporters of inaccurate information also incur the expected costs associated with their information being discovered as being  inaccurate, such as loss of reputation:

(2)  Net Benefit(Inaccurate)

= Benefit(Inaccurate) –  Cost(Inaccurate)

– Prob_Caught(Inaccurate) x Damages(Inaccurate)

When will reporters find it in their interest to report inaccurate information while passing it off as being accurate? This will happen when

(3)  Net Benefit(Inaccurate) > Net Benefit(Accurate),

which happens when

(4)  [Benefit(Inaccurate) – Benefit(Accurate)] + [Cost(Accurate) – Cost(Inaccurate)]

>  Prob_Caught(Inaccurate) x Damages(Inaccurate).

The relationship in (4) has three basic elements:

  • Value Component: Does the reporter get more value from reporting inaccurate information?
  • Cost Component: Does the reporter save costs (time and effort) from reporting inaccurate information?
  • Damages Component: Is the expected penalty from being caught reporting inaccurate information large or small?

 

Drivers of Inaccurate Reporting

So the relationship in (4) says that people will do better by passing off inaccurate information as being accurate when the incremental benefits of doing so plus any incremental cost savings exceed the expected costs of being caught reporting bad information.

Generally speaking, relative to the case in which they report accurate information,

  • People who report inaccurate information that is either premature or sloppy are seeking to reduce costs, while
  • People reporting biased, propagandized or sensationalized information are seeking to increase the value of their reported information.

This hypothesis is illustrated in Figure 2.

Figure 2

 2 drivers2

So then we can conclude that people will tend to try to pass of inaccurate information as being accurate in any of the following situations:

  • The value to the reporter of reporting fake information is greater than the value of reporting accurate information. This will be the case, for example, when people are biased or trying to signal belonging, when people are spreading propaganda, and/or when people are trying to either spread gossip or gain money or recognition.
  • The costs of reporting inaccurate information are less than the costs of reporting accurate information. This will occur when time and/or effort and/or resources are needed to gather accurate and complete information, check sources, wait for clarification, etc. This will be the case when information is time sensitive, costly, complicated or complex, or subject to dispute.
  • The probability of getting caught trying to pass off bad information as being good is low. This will be the case when information is complicated or complex, asymmetric, overwhelming in supply, or otherwise difficult or costly to verify or validate.
  • If caught trying to pass off bad information as being good, then the punishment is low. This will be the case when society doesn’t place a high value on the truth.

 

Consequences of the Increasing Prevalence of Inaccurate Information

In a previous blogpost, Information Distortions on the Internet, I concluded that the consequences of having a lot of inaccurate information on the Internet included:

  • Good judgment will become more valuable.
  • Organizations will emerge to defend against information manipulations.
  • Important information may become overlooked.
  • Reputation will become more important.

In a different, previous blogpost, A Brief Overview of the Fake News Game, I analyzed the proliferation of fake news by people trying to make money by promoting sensationalized information. In that analysis I came to the following conclusions:

  • The more difficult it is to verify (and weed out) news and information for accuracy and legitimacy, the more fake news and information will appear.
  • The more fake news there is that is reported or posted, the more difficult (more costly) it is to verify the accuracy of any given piece of news and information. That is, there is a feedback loop here.
  • The lower is the penetration of fake news and information, the greater is the tendency for Users to assume news and information is generally true.
  • However, once a minimum threshold of misinformation has been achieved, Users can no longer assume that news and information is generally true. I think we’ve almost achieved this tipping point.

 

Promoting Accurate Reporting

From the analysis above on Drivers of Inaccurate Reporting, it follows that the reporting of accurate information will be promoted by

  • Having a culture that values The Truth, even if it conflicts with our desires and/or beliefs.
  • Having a culture that’s more forgiving of people who don’t share the same beliefs as we do.
  • Having a culture which is less stimulated by gossip or sensationalism (this probably goes against human nature).
  • Having a culture that rewards efforts to discover new information (e.g., in science or healthcare), even if those efforts don’t pan out.
  • Subsidizing the costs of discovering/reporting new, accurate information. A lot of this is already happening. We could, however, do more to decrease liability for companies that are more forthcoming in their reports of complete and accurate information. For example, we could decrease liability to pharmaceutical companies who provide full and accurate reporting of side-effects.
  • Increase the chances of getting caught reporting inaccurate information. This would happen naturally to some extent if people valued The Truth more and/or supported efforts to find new information even if they weren’t successful.
  • Increase the costs incurred when caught reporting inaccurate information. This could be accomplished, for example, through public shaming, holding people more accountable for inaccurate reports of information, developing reputation systems, and valuing good reputations.

 

Emergence of Efforts to Promote Accurate Information

Recently there have been several different examples of individuals or organizations founded to encourage more accurate and complete reporting of information.

Authentication Systems

Authentication systems are being used to create accountability by users. Angela Shah provides an example of one such authentication system in “Amid Fake News, Authenticated Reality Launches ‘The New Internet’”:

Chris Ciabarra, co-founder and CTO of Authenticated Reality, says the startup’s new browser—one that would require users to prove they are who they say they are—is the right way to mend what’s wrong with the Internet. With his product, “everyone knows who everybody is,” he says. “When you do something, you’re putting your reputation behind it.”

Aggregations of Efforts to Replicate Study Results

A new online journal is aggregating people’s efforts to replicate the findings of scientific studies. The purpose of the journal is two-fold. First, it will help inform researchers so they don’t “waste time following up on flawed findings.” Second, the journal will provide recognitions to researchers who make the effort to replicate reported results. As Jocelyn Kaiser reports in, “If you fail to reproduce another scientist’s results, this journal wants to know”:

The biotech company Amgen Inc. and prominent biochemist Bruce Alberts have created a new online journal that aims to lift the curtain on often hidden results in biomedicine: failed efforts to confirm other groups’ published papers. Amgen is seeding the publication with reports on its own futile attempts to replicate three studies in diabetes and neurodegenerative disease and hopes other companies will follow suit.

The contradictory results—along with successful confirmations—will be published by F1000Research, an open-access, online-only publisher. Its new “Preclinical Reproducibility and Robustness channel,” launched today, will allow both companies and academic scientists to share their replications so that others will be less likely to waste time following up on flawed findings…

Alberts, a former Science editor-in-chief and National Academy of Sciences president who is at the University of California, San Francisco, says the journal will be a place for data that other journals often aren’t interested in publishing because replication efforts lack novelty. “The whole idea is to lower the energy barrier for people doing this,” Alberts says.

Evaluation of Healthcare Reports for Completeness

Recently, a new organization started evaluating new releases of healthcare information for accuracy and completeness in reporting of relevant information. From the company’s website:

HealthNewsReview.org evaluates health care journalism, advertising, marketing, public relations and other messages that may influence consumers and provides criteria that consumers can use to evaluate these messages themselves.

The company uses the following criteria in its ratings of news releases:

  • Criterion #1: Does the story adequately discuss the costs of the intervention?
  • Criterion #2: Does the story adequately quantify the benefits of the treatment/test/product/procedure?
  • Criterion #3: Does the story adequately explain/quantify the harms of the intervention?
  • Criterion #4: Does the story seem to grasp the quality of the evidence?
  • Criterion #5: Does the story commit disease-mongering?
  • Criterion #6: Does the story use independent sources and identify conflicts of interest?
  • Criterion #7: Does the story compare the new approach with existing alternatives?
  • Criterion #8: Does the story establish the availability of the treatment/test/product/procedure?
  • Criterion #9: Does the story establish the true novelty of the approach?
  • Criterion #10: Does the story appear to rely solely or largely on a news release?

Bounty for Proof of Malfeasance

James O’Keefe, political activist and Founder of Project Veritas, is trying to publicize the malfeasance of the mainstream media (MSM). He’s released tapes of conversations by CNN reporters captured covertly, and he is offering a bounty for further evidence of “media malfeasance.” According to Tyler Durden in, “O'Keefe Drops "Bombshell" Undercover Video Footage From Within CNN,”

…James O'Keefe and his team at Project Veritas just released covertly captured, previously unseen video footage from within the CNN newsroom. But unlike his usual undercover sting operations, this footage was allegedly sourced from a CNN insider who apparently grew frustrated with the biased reporting of the "fake news" media outlet.



Meanwhile, noting that this is just the "beginning of the end for the MSM", O'Keefe also announced that he will pay a $10,000 award to anyone who comes forward with legally obtained audio or video footage exposing media malfeasance.

Objective Pros and Cons of Controversial Issues

One company, ProCon.org, was founded to provide “professionally-researched pro, con, and related information on more than 50 controversial issues.” From Procon.org’s website:

ProCon.org, a 501(c)(3) nonprofit nonpartisan public charity, provides professionally-researched pro, con, and related information on more than 50 controversial issues from gun control and death penalty to illegal immigration and alternative energy. Using the fair, FREE, and unbiased resources at ProCon.org, millions of people each year learn new facts, think critically about both sides of important issues, and strengthen their minds and opinions.

Founded on July 12, 2004, our innovative educational website has become the country’s leading source for nonpartisan information and civic education…



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