Masherg's Law

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Masherg's Law states that a flood of bad information will drown out a trickle of good information. For society, the major cost of low-quality information is that it drives out high-quality information. Consumers devalue information, not knowing what to believe, unable to distinguish low quality from high because there is no Signalling (economics) to differentiate. Signals about Information quality must be sent in a broad framework for the consumer to receive, process, and understand them. High-quality information producers have their signals diluted by low-quality imitators. Individual costs (decisions guided by misinformation and general societal costs due to market failure are the result. High-quality news suppliers and their content get lost in the sheer volume of low-quality suppliers.

Corollaries

Corollary 1: A flood of bad information drowns out more bad information. Examples: a politician covering up one misdeed with many more; a doctor saying you have a broken arm followed by saying you have cancer. This corollary can be used intentionally for obfuscation.

Corollary 2: A flood of any information drowns out other information, good or bad. Example: lengthy instruction manuals obscuring the essential information; wordy websites hiding a good story; long-winded guests giving lengthy toasts.

Causes

Masherg's Law is caused by the special properties of information products, which include easy-to-copy, easy-to-share, easy-to-access, low storage cost, low distribution cost, inexpensive search, rapid growth rate, abundant low quality, non-destructive consumption, continual drop in processing costs. Masherg's Law is enabled by the historicaly drop in processing costs (Moore's law), amenable to network effects (Metcalfe's law), and near-instantaneous distribution.

Economic basis

With the perceived price of zero, a price-like quantitative metric is absent with much information. When a consumer perceives the price to be zero, quality is the sole determinant of their consumption. When quality is difficult to determine, Masherg’s Law is asserted. The market fails due to an odd combination of a perceived endless supply at a perceived price of zero. This drives a market flooded with information.

Illustration

Buying any product is based on price and quality. Yet the consumer perceived price is zero for widely available news products. With it free, the price is no longer a consideration. Consumers have only quality criteria, which is easy for a car – color, acceleration, number of seats – but difficult for information.

Few consumers have the time, knowledge, or energy to search the internet for good information. Unlike cars, consistent rigorous news quality assessment is too hard for consumers. Lexus cars are famous for high quality. The Yugo makes many lists of the worst cars. Consumers can tell the difference and are unwilling to pay for low quality.

Topics outside of a consumer’s expertise, rapidly changing in the 24-hour news cycle and driven at the speed of technology, creates huge volumes of information. Consumers cannot keep up with the flood and have difficulty assessing the good information among the bad, resulting in Masherg’s Law. And with a price of zero, there is no economic incentive to tell good quality from bad quality.

Applications

Public News

Suppliers and consumers share the complex information market dynamics of the 24-hour news cycle, which generates a flood of news. The volume and speed across many diverse topics are impossible for a consumer to process. Consumers cannot keep up with the knowledge needed to comprehend topic after topic. The flood comes fast, leaving consumers exhausted or disengaged. Technology enables suppliers to exploit niche markets without concern for objective quality, leading high quality mainstream suppliers to compete on sensationalism and driving Masherg’s Law.

Health Information

It is difficult for consumers to comprehend internet medical information, Volumes of bad information are easily obtained, and good information is hard to detect. Consumer “use of the Internet as a source of health information has raised concerns about consumers' ability to tell 'good' information from 'bad' information. Although consumers report that they use source credibility to judge information quality, several observational studies suggest that consumers make little use of source credibility.” Huge volumes of health information drives Masherg’s Law, sometimes with serious health consequences.

Commentary

George Akerlof

George Akerlof’s Nobel Prize winning work on the market for lemons gave a structure “for determining the economic costs of dishonesty.” The rise of the internet and social media has revealed dishonesty for information itself. With unverifiable factual quality, the least honest have incentive to dishonesty, building a following by making up opinions and using technology to distribute to consumers. Dishonesty is limited when product or service quality can be verified. But Masherg’s Law essentially makes it improbable that a consumer can tell good information lost in the sea of bad information.

Bernard Shaw

Bernard Shaw (journalist) spoke about the risk posed to news accuracy by low-quality, profit-driven information content generating huge volumes of unverifiable information.

Herbert Simon

Masherg’s Law was evident when the famous scientist Herbert A. Simon wrote “A wealth of information creates a poverty of attention.” Masherg’s Law acknowledges that consumer attention is a limiting factor with the flood of information.

References

This article "Masherg's Law" is from Wikipedia. The list of its authors can be seen in its historical and/or the page Edithistory:Masherg's Law. Articles copied from Draft Namespace on Wikipedia could be seen on the Draft Namespace of Wikipedia and not main one.

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