A rational inattention theory of echo chamber

What is it about?

The rise of echo chambers and the driving force behind it have been the subject of heated debate in the academia and popular press. We show that rational inattention---the rational and flexible allocation of limited attention capacities across information sources---can generate echo chambers among individuals who are initially biased towards different decisions. Our models features rational individuals who gather information about an uncertain state by allocating limited attention capacities across biased primary sources and the other players. The resulting Poisson attention network transmits information from the primary source to a player either directly or indirectly through the other players. Rational inattention generates heterogeneous demands for information among players who are initially biased towards different decisions. In an echo chamber equilibrium, each player restricts attention to his own-biased source and like-minded friends, as the latter attend to the same primary source as his, and so could serve as secondary sources in case the information transmission from the primary source to him is disrupted. We provide sufficient conditions that give rise to echo chamber equilibria, characterize the attention networks within echo chambers, and use our results to inform the design and regulation of information platforms. In particular, we find that exposing individuals to all biased sources dissolves echo chambers but may undermine social welfare, and that interventions that target misinformation and fake news through modulating account visibility may backfire if they are not meticulously calibrated according to the underlying environment.

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Why is it important?

Most ongoing discussions about echo chambers focus on their behavioral origins. We show that echo chambers can arise among rational individuals, provided that the latter can flexibly allocate their limited attention capacities across information sources. To this end, we develop a general framework for studying the equilibrium attention networks among rationally inattentive individuals. Our results inform the design and regulation of information platforms and address the controversy of many recent policies that target polarization, misinformation, and fake news.

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