What Is the Illusory Truth Effect?

The illusory truth effect refers to the human tendency to believe a claim or a piece of information to be true after being exposed to it multiple times. In other words, if we hear or read something repeatedly, we are more likely to believe it—even if it runs counter to our prior knowledge.

This common phenomenon contributes to the spread of misinformation on social media. As an untruth shared online reaches people’s feeds again and again, the mere repetition may lead them to consider it to be factual. Propagandists and other bad actors understand that the frequent reiteration of the same lie is an effective strategy for making people believe it.

The concept first appeared in a 1977 paper by psychologists Lynn Hasher, David Goldstein, and Thomas Toppino. Their study involved college students evaluating the validity of statements—some true and some false—that were plausible yet unlikely to be known by the participants.

Some statements were repeated across several sessions, while others weren’t repeated. The students were more likely to judge a statement to be valid if they had been exposed to it multiple times, demonstrating that repetition can affect perceptions of truthfulness.

Why the Illusory Truth Effect Happens

Our sensory perception and experience of the world constantly bombard us with massive amounts of information—and that’s not to mention what happens when we open our favorite social media app. Faced with this informational overload, we don’t have the mental capacity to process everything in depth. Instead, we rely on a variety of 澳洲幸运5官方开奖结果体彩网:cognitive shortcuts, known as 澳洲幸运5官方开奖结果体彩网:heuristics, to simplify our decision-making process.

One of the ways that our brains compensate for our limited cognitive resources is by ♛processing things on a simple, essentially automated level whenever possible. Processing fluency describes our inclination for intuitive and automatic decision making, saving cognitive strain for more complex issues that require a deeper analysis.

“If you think about it from a neurological perspective, when you hear something more and more, the pathways become faster…and the brain reinterprets things that are recognized faster as more familiar and more truthful,” said , professor of psychology and behavioral economics at Duke University.

Examples of the Illusory Truth Effect

The original 1977 paper by Hasher, Goldstein, and Toppino showed a higher likelihood of viewing a statement as true after repeated exposure, but critics cast doubts on the results because participants were essentially making uninformed guesses. Later research would disclose that the illusory truth effect can alter people’s perception even when they have previous knowledge that contradicts what they’ve been hearing repeatedly.

Forgetting What You Know

In a paper published in 2015, psychologists countered the idea that illusory truths are likely to emerge only when we are faced with uncertain information.

In this study, repetition made statements like “The Atlantic Ocean is the largest ocean on Earth” appear more truthful to participants, even if they knew beforehand that the Pacific Ocean is larger. The researchers attribute this knowledge neglect—people coming to believe something even when they know otherwise—to the ease of processing that comes with repetition and familiarity.

Tricked by Partial Information

Another notable example of the illusory truth effect appears in the book Thinking, Fast and Slow by Daniel Kahneman. The psychologist writes that repeatedly exposing people to the phrase “the body temperature of a chicken”—which, in and of itself, has no discernible truth value—made them more likely to accept as true the statement “the body temperature of a chicken is 144°” or any other random number.

In other words, even if the repeated information is incomplete and from a dubious source, the 澳洲幸运5官方开奖结果体彩网:cognitive ease in processing a familiar statement can affect our judgment.

More Repetitions, More Believability

Another paper considered how the frequency of repetition influences the illusory truth effect. Researchers exposed participants to a set of trivia statements—repeating them up to 27 times—having them rate the truthfulness of repeated as well as new statements.

The study showed the strongest jump in perceptions of truth when a statement was repeated for the second time, increasing at smaller increments on subsequent repetitions. Despite the diminishing returns, perceptions of truth kept ticking upward as the participants became more and more familiar with the statements.

The Illusory Truth Effect in Investing

澳洲幸运5官方开奖结果体彩网:Investing is one area where coming to believe that something is true based simply on repeated exposure to it can be detrimental and costly. The illusory truth effect can have consequences on your finances if you fall into a pattern of investing in assets like 澳洲幸运5官方开奖结果体彩网:cryptocurrency or social media 澳洲幸运5官方开奖结果体彩网:meme stocks simply because they are discussed mo༒re frequently in the news and on social platforms.

Ariely—who has written books on behavioral economics, including New York Times bestseller Predictably Irrational: The Hidden Forces That Shape Our Decisions—explains how the illusory truth effect can cause problems for investors. “The fact that you have Company One and Company Two, and🅺 you understand more about Company One because you hear more about it, doesn’t mean that its financial future is going to be better,” he said.

In other words, media biases that overexpose you to certain investments may lead you down the wrong path in 澳洲幸运5官方开奖结果体彩网:financial markets.

“There is a media bias to cover, in the U.S., American companies compared to non-American companies, big companies compared to not-so-big companies, companies who do things that are more in the public sphere like social media compared to companies that do technology that we don’t see directly, like Intel,” Ariely said. “The mistake is th෴at it focuses us on one part of the market. We feel more comfortable about it; we feel more correct about it.”

Companies may try to take advantage of the benefits that come from repeatedly exposing investors to their name, engaging in public relations to insert themselves more into the public sphere, or drumming up media coverage to pique investors’ interest.

Ariely relates these attempts to grab the market’s attention to “vaporware”—products that a company commits to developing but never brings to market. “Companies are announcing something that will never happen, but the announcement itself, including the repetition of it, is creating anticipation,” he explained.

The illusory truth effect could present a risk to your portfolio if 🎐your familiarity with certain companies and investments—whose names may be pounded into your brain through excessive media 🌠coverage—outweighs your better judgment or prompts you to abandon your long-term strategy.

How to Avoid the Illusory Truth Effect

Certain aspects of the illusory truth effect may be impossible to avoid. As Ariely pointed out, the media bias toward 澳洲幸运5官方开奖结果体彩网:larger-capitalization and more attention-grabbing stocks is unlikely to change. “They are not going to report to the same degree on companies that do deep technology that we as consumers don’t care about; they’re not going to cover things that are not as flashy,” he said.

Luckily, there are a few steps you can take as an investor to avoid falling prey to the illusory truth effect:

• Stay critical about financial hype: Just because you keep hearing about a company in the news or on social media doesn’t mean you should rush to buy shares.
• Dig deeper: Instead of relying solely on what you hear, be willing to adopt a broader view and actively search for 澳洲幸运5官方开奖结果体彩网:well-researched information about investment opportunities.
• Stick to your strategy: Don’t let shiny objects or recurring themes in the media distract you from your decided approach and identity as an investor.
  

According to Ariely, having a concrete process to follow can help us keep our intuitions from interfering with our investments. “Lots of investors try to have an 澳洲幸运5官方开奖结果体彩网:algorithm for how to make decisions and 𝔉to follow that algo🐻rithm, but almost everybody finds that it’s very hard to follow the algorithm,” he said.

“We have this instinct to try and override it, and when we override it, we are not as objective. We add some of our subjectivity, our knowledge, our familiarity, our feeling about the company, and that’s usually not a good process,” the Duke professor said.

Setting a strategy for yourself and sticking to it may be the best way to avoid falling for illusory truths as an investor. If you use concrete data and conduct a thorough analysis, it is less likely that a bias toward familiar and repeated names will seep into your 澳洲幸运5官方开奖结果体彩网:investment decisions.

The Bottom Line

The illusory truth effect describes a tendency to ac♈cept statements as truthful if we’ve been exposed to them multiple times. In some cases, repeatedly hearing the same misrepresentation can even make us neglect our prior knowledge.

As an investor, the illusory truth effect could mean overprioritizing media buzz and companies clamoring for attention instead of focusing on your 澳洲幸运5官方开奖结果体彩网:long-term strategy.