Policy interventions aimed at correcting self-servingly biased misperceptions are unlikely to be effective in the long run due to people’s ability to forget or suppress information that threatens their desired views

The Dynamics of Motivated Beliefs. Florian Zimmermann. American Economic Review. Feb 2020, Vol. 110, No. 2: Pages 337-363. https://pubs.aeaweb.org/doi/pdfplus/10.1257/aer.20180728

Abstract: A key question in the literature on motivated reasoning and self-deception is how motivated beliefs are sustained in the presence of feedback. In this paper, we explore dynamic motivated belief patterns after feedback. We establish that positive feedback has a persistent effect on beliefs. Negative feedback, instead, influences beliefs in the short run, but this effect fades over time. We investigate the mechanisms of this dynamic pattern, and provide evidence for an asymmetry in the recall of feedback. Finally, we establish that, in line with theoretical accounts, incentives for belief accuracy mitigate the role of motivated reasoning. (JEL C91, D83, D91)

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We find that negative feedback is indeed recalled with significantly lower accuracy, compared to positive feedback, which suggests that the dynamic belief pattern we have identified is indeed driven by the selective recall of information. Next, we make use of additional outcome variables and a placebo condition to delve into how selective recall operates. In a nutshell, the following patterns emerge. Our results suggest that participants are able to suppress the recall of unwanted memories. Furthermore, participants appear to suppress the recall of not only negative feedback but also the IQ test more broadly. Our results lend direct support to key modeling assumptions in Bénabou and Tirole (2002, 2004). From a policy perspective, our findings suggest that policy interventions aimed at correcting self-servingly biased misperceptions via information or feedback are unlikely to be effective in the long run due to people’s ability to forget or suppress information that threatens their desired views.