When Imperfect Automated Fact-Checking Backfires: Social Learning in the Presence of Misinformation

Zixuan Liu, Ming Cao

Automated fact-checking tools, cheap and fast but imperfect, are increasingly available on social platforms. We study when such tools can backfire in a sequential social learning model of misinformation. Agents observe an article's reliability and their predecessors' actions, which indicate whether they liked or disliked the article. They may also pay to fact-check it. We examine how welfare, defined as the probability of a correct cascade, changes when a free, error-prone automated tool supplements costly but perfectly accurate manual fact-checking. Two opposing effects arise. Broader use of fact-checking helps agents escape wrong cascades. At the same time, errors from the automated tool can mislead agents who would otherwise have verified the article perfectly, reducing the likelihood of correct cascades. We prove that adding the tool strictly lowers welfare for articles of intermediate reliability when truthful articles are not too informative and manual checking is sufficiently costly. Simulations show that the tool can help on either side of the intermediate range, and that it improves on manual-only checking on average only above a threshold accuracy.