Question

Transparency increases the cost of hiding the truth. More efficient interactivity exposes truths that used to be inexpensive to hide.” Explain what this means and provide an example

Answer 1

With the advent of social media and the increased interconnectivity and interactivity, there has been an increased transparency in most of the information. Hence, hiding truth will be costly for the individuals or firms as it will be easily exposed if it creates any negative impact.

Example is - Scrutiny on a firm's CSR activities which it claims to be doing.

Also, the more efficient the interactivity is among people, it exposes the truths that used to be inexpensive to hide meaning not so secret information can be easily discussed and shared with the increase in interaction.

Example is - Personal preferences of the individual which used to be kept private earlier is being shared on social media now.