Mignot, Sarah; Pellizzari, Paolo; Westerhoff, Frank H. - 2024
We explore the impact of fake news on asset price dynamics within the asset-pricing model of Brock and Hommes (1998 …). By polluting the information landscape, fake news interferes with agents' perception of the dividend process of the risky … asset. Our analysis reveals that fake news decreases the steady-state price of the risky asset by making it even more risky …