Duplicitious or false advertising has been around as long as advertising has been around.  Federal laws, enforced by the Federal Trade Commission, prohibit the use of false or misleading information inadvertisments.  Nevertheless, false advertising continues to be used by many businesses today.

Quite frankly, false advertising affects peoples' behavior the same way that honest advertising does: both are intended to influence the consumer's decision-making process in favor of the advertised product.  And most advertising is at least a little misleading in emphasizing a product's qualitative superiority over that of the competition.  Anybody who has shopped for a new car has experienced the phenomenon whereby the salesman claims to have worked for a competing manufacturer, but now is working for the one that makes the best cars.  The salesman has "seen the light," and now only sales products of which he is personally proud.

False advertising incorporates a number of tactics, including claiming that the product performs not just better than the competition, but better than it actually does.  It is all intended to influence the consumer's behavior.  Vance Packard's 1957 book The Hidden Persuaders was an eye-opening examination of how advertisers use "subliminal" techniques in their advertisements intended to infiltrate the subconscious of consumers and influence their purchasing decisions without them realizing they were subjected to such tactics.  By hiding words or symbols inside the advertisement, the public was being manipulated in a certain company's favor.

An effective advertiser understands human psychology, and how to appeal to the desires that exist in most men and women -- desires ranging from how to look cool in certain clothes to what detergent will best bring out the colors in that apparel.  Tobacco advertisers were so successful in convincing  people to smoke cigarettes that the federal government finally banned cigarette advertisements on television and radio with the 1970 Public Health Cigarette Smoking Act.

All advertising seeks to influence the decisions consumers make.  Whether the advertisement is false may mislead some people, but it all works the same way, and to the same goal.  

According to the Federal Trade Commission's statement on ad deception of 1984, the agency has a responsibility to declare unlawful any kind of practice that in an unfair and deceptive way aims to manipulate the public's perception of a good or a service. Under Sections 5 and 12 of the statement, the Commission is specific in the description of "deceptive acts or practices" precisely because of the behavioral effects that these practices causeon potential consumers.

The salient behavioral effect is decision-making. Through false advertisement, a potential consumer who is susceptible to misinformation will undoubtedly act upon the false claims of an advertisement, and may potentially increase or decrease his or her consuming practices. For example, if a company promotes a tonic to reduce body-fat percentage, a consumer who needs to reduce body fact (and believes what the advertisement claims) will make the erroneous choice of buying and using the product. This is because the advertisement falsely promoted a solution which, in turn, will induce the consumer to place trust (and a lot of money, at times) in a product that does not really work.

If the FTC does not keep a watchful eye on advertising practices, the entire population would be placing their money and trust on products and services that are misrepresented and deceitful. Hence, it is imperative to always keep the door of reasonable doubt open prior to engaging in the subtle interactivity of advertising.

How does deception in advertising affect people cognitively?

Changizi and Shimojo's 2008, article "A functional explanation for the effects of visual exposure on preference" published in Perceptionmagazine (37), explains in detail the correlation between cognitive activity and advertisement. This correlation can be applied to false advertising if we also add the principle of the "Misinformation Effect" which is an actual cognitive effect of false advertisement.

The article presents how over-saturation is often a technique used by advertising agencies with the purpose of searing catchy words, facts, and details about a specific product in the mind of the potential customer. The problem with over-saturation is that there is a risk of automatic rejection, as the brain has become so over-stimulated by one same message that, instead of adapting to it, it simply refutes it; it is no different than listening to a song over and over to the point where your brain cannot take it anymore and you instantly change the channel. That is one way in which advertising affects the cognitive ability of the brain.

Now, false and deceptive advertisement goes one step further. According to the principle of the Misinformation Effect, potential customers do experience a change in their memory retrieval when exposed to deceitful or misinformed advertisements.

According to the leading expert in Misinformation Effect, Elizabeth Loftus, when a consumer encodes a commercial or advertisement, either after over-saturation or before, the customer will likely remember the commercial or advertisement thanks to the myriad of eye-catching techniques applied by the marketing agency to make the message "stick".

However, when consumers discover that the advertisement is false, or deceptive, a form of retroactive interference takes place where that new information about the product (the fact that it is false) pervades the long term memory system and prevents customers from remembering vital information about the add that they originally saw.

The implication is that, if advertisement agencies are going to produce false advertisements just to get customers, they better not let out any secret about the misleading facts because the long term memory of the customers DOES become affected after finding out new information, in what is known as retroactive interference. This is a research-based finding that has been studied for over 30 years by Loftus et al. Therefore, there is indeed a strong connection between cognition and advertising. 

How does deception in advertising affect people attitudinally?

False advertising, or deception in advertising is defined by law as

"Any advertising or promotion that misrepresents the nature, characteristics, qualities or geographic origin of goods, services or commercial activities" (Lanham ACT, 15 U.S.C.A. § 1125(a)).