On June 2, The Hamilton Project hosted an event exploring the costs of social media. In conjunction with the event, The Hamilton Project released two policy briefs that examine the economic case for regulating or restricting social media. One of the briefs, authored by Hunt Allcott, Matthew Gentzkow, and Lena Song, presents evidence that many adults are addicted to social media. The authors estimate that about one-third of social media use is driven by digital addiction. The other brief, authored by Leonardo Bursztyn, Benjamin Handel, Rafael Jiménez-Durán, and Christopher Roth, concludes that many social media users are caught in a product market trap, meaning that they feel compelled to use social media, even though they wish it did not exist to begin with.
Aviva Aron-Dine, director of The Hamilton Project, introduced the fireside chat between Dr. Vivek Murthy (19th and 21st surgeon general of the United States) and Cecilia Kang (The New York Times).
Dr. Murthy discussed the potential harms and dangers of social media and how it has become a health crisis. He discussed his 2024 New York Times op-ed and a report that he commissioned that found there was not enough evidence to say that social media is safe for kids; indeed, there is growing evidence of harm. It is important to note that these issues are not isolated to children; adults struggle as well.
Cecilia Kang asked about what it would take in terms of regulations to make social media safer for young people and all users. Dr. Murthy responded, “this is not a problem you fix by providing more education alone to families…. We need to look at design itself and require that these platforms do not engage in creating the kind of features that look to maximize how much kids use them that contribute to the compulsion that many kids have. You can also put in place regulations that require data transparency, that also require public audits. You can also put in place restrictions around age. Finally, I think that when it comes to a genuine duty of care that is legislated here, a legal obligation, if you will, to act in the best interests of a child, and accountability and liability if that duty is not met. Having the right legislation and regulation is one part of the puzzle, enforcing that is another. In the United States, we don’t even have meaningful federal legislation in place to create some of these measures we’ve been talking about. And once we do that, we’ve got to ensure that those are enforced quickly, appropriately, so that kids can get the safety that they’ve long needed.”
Dr. Murthy closed the discussion by reminding the audience “to stay human… we are being forced to ask that question, what makes us truly human, and how do we protect it? What is irreplaceable by machines? And I think that our ability to be empathic, our physical presence with another person, the life experience we bring to relationships and conversations, the values that we hold, hard-fought and hard-won values that shape our decisions, our society, and ultimately our technology.”
Bradley Hardy (Georgetown University) then moderated a panel discussion with two of the authors of the policy briefs: Benjamin Handel (University of California, Berkeley) and Lena Song (University of Illinois-Urbana Champaign).
Song noted that typical adults spend about two and a half hours a day on social media. Digital addiction, while not a clinically recognized disorder, has similarities to gambling and substance abuse, and Song explained how the economic concepts used to study those addictions can be connected to digital addiction. She described the experiment she conducted with coauthors finding that self-control problems and habit formation, both markers of addiction, are important drivers of social media use.
Handel discussed how his research illuminates why so many people use social media but also feel uncomfortable with that use. While addiction can be one reason, it is not the only reason. Handel described the experiment he conducted with coauthors finding evidence of a product-market trap for social media platforms: “A product market trap exists when people are using a product, or feel pressured to use a product even though, if they could take a step back, they would say, we actually wish this product didn’t exist.”
To close out the discussion, Hardy raised the question of how economic analysis can inform policy solutions to the problems posed by social media. Handel and Song focused on their respective findings on the externalities (harms to others) and “internalities” (harms to a person’s own future self) resulting from social media use. Handel noted that “there’s a range of ways with internalities that companies can increase demand for social media and other products by making the experience of not using that product worse.” Song posed the question of how to address “self-control problems while still preserving agency for the individual users…. what limits should look like on people’s phones… and whether we might want to introduce some of these tools or encourage people to use these tools on both platforms, as well as the devices that they’re using.”
This is a recap of “Understanding the costs of social media.”
