Can Prompting Investors to be in a Deliberative Mindset Reduce Their Reliance on Fake News?

We examine if prompting investors to be in a deliberative mindset reduces their reliance onfinancial news that is later revealed to be fake. Consistent with theory, results of an experimentshow that investors reduce their reliance on news revealed to be fake, and that this reduction ismagnified for investors who were previously prompted to be in a deliberative mindset.Importantly, results also reveal that prompting investors to be in a deliberative mindset does notaffect their judgments when the news is later revealed to be true. Our study contributes to researchon fake news in the financial markets and has practical implications for investors when evaluatingnews that may be true or fake