The analogy is drawn between social media and cigarettes, highlighting the challenge of avoiding the negative externalities. While one can avoid second-hand smoke from cigarettes by not being around smokers, the only way to avoid the negative effects of social media is by not using it, which could lead to isolation. The discussion also touches on the difficulty of making an overall argument regarding the impact of ads on social media, comparing it to critiques of consumer capitalism from decades ago.
Economists have discovered an odd phenomenon: many people who use social media (even you, maybe?) wish it didn’t exist. But that doesn’t mean they can escape.
- RESOURCES:
- "When Product Markets Become Collective Traps: The Case of Social Media," by Leonardo Bursztyn, Benjamin Handel, Rafael Jimenez, and Christopher Roth (NBER Working Paper, 2023).
- "Social Media and Xenophobia: Evidence from Russia," by Leonardo Bursztyn, Georgy Egorov, Ruben Enikolopov, and Maria Petrova (NBER Working Paper, 2019).
- "Status Goods: Experimental Evidence from Platinum Credit Cards," by Leonardo Bursztyn, Bruno Ferman, Stefano Fiorin, Martin Kanz, and Gautam Rao (NBER Working Paper, 2017).
- "'Acting Wife': Marriage Market Incentives and Labor Market Investments," by Leonardo Bursztyn, Thomas Fujiwara, and Amanda Pallais (American Economic Review, 2017).
- "Measuring Crack Cocaine and Its Impact," by Roland G. Fryer Jr., Paul S. Heaton, Steven D. Levitt, and Kevin M. Murphy (Economic Inquiry, 2013).