Lessons From an Oops at Consumer Reports®: Consumers Follow Experts; Ignore Invalid Information

In 2007 Consumer Reports released, and two weeks later retracted, a flawed report on the safety of infant carseats. Analyzing data from 5,471 online auctions for carseats ending before, during and after the information was considered valid I find that (1) consumers responded to the new information, and –more interestingly- that (2) they promptly ceased to do so once it was retracted. This first finding, thanks to the random nature of the flawed ratings, demonstrates that expert advice has a causal effect on consumer demand. The second finding suggests that people’s inability to willfully ignore information is not as extreme as the experimental evidence in the psychological literature would suggest.