http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1084585

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What can government do about conspiracy theories? Among the things it can do, what should it do? We can readily imagine a series of possible responses. (1) Government might ban conspiracy theorizing. (2) Government might impose some kind of tax, financial or otherwise, on those who disseminate such theories. (3) Government might itself engage in counterspeech, marshalling arguments to discredit conspiracy theories. (4) Government might formally hire credible private parties to engage in counterspeech. (5) Government might engage in informal communication with such parties, encouraging them to help. Each instrument has a distinctive set of potential effects, or costs and benefits, and each will have a place under imaginable conditions. However, our main policy idea is that government should engage in cognitive infiltration of the groups that produce conspiracy theories , which involves a mix of (3), (4) and (5).

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An obvious answer is to maintain an open society, in which those who are tempted to subscribe to conspiracy theories do not distrust all knowledge-creating institutions, and are exposed to corrections. But we have seen that even in open societies, conspiracy theories have some traction; and open societies have a strong interest in debunking such theories when they arise, and threaten to cause harm, in closed societies. Here we suggest two concrete ideas for government officials attempting to fashion a response to such theories. First, responding to more rather than fewer conspiracy theories has a kind of synergy benefit: it reduces the legitimating effect of responding to any one of them, because it dilutes th e contrast with unrebutted theories. Second, we suggest a distinctive tactic for breaking up the hard core of extremists who supply conspiracy theories: cognitive infiltration of extremist groups, whereby government agents or their allies (acting either virtually or in real space, and either openly or anonymously) will undermine the crippled epistemology of those who subscribe to such theories. They do so by planting doubts about the theories and stylized facts that circulate within such groups, thereby introducing beneficial cognitive diversity.