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Intrinsic preferences for unhappy news

Lookup NU author(s): Dr Tom Lane

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Abstract

In ordinary life, many types of situation occur in which a better-informed agent faces a decision over whether to reveal some bad news to an uninformed counterpart. This paper reports an experiment designed to explore how, in such contexts, the decisions of informed individuals are shaped by intrinsic preferences over information. Impartial spectators are tasked with deciding whether to make initially uninformed subjects aware that their actions have inadvertently generated negative externalities. Knowledge of this consequence is materially useless and reduces the subjective happiness of the externality-generating subjects, as is anticipated by the vast majority of spectators. However, 72% of spectators still choose to reveal the information. This suggests the existence of intrinsic preferences for information possession which are not based on hedonic considerations and indeed are sufficiently strong as to trump spectators’ concerns about the negative hedonic consequences of revelation. However, the hedonic impact of information is not completely overlooked, as spectators are less likely to reveal information the more strongly they believe it will damage the recipient's happiness.

Publication metadata

Author(s): Lane T

Publication type: Article

Publication status: Published

Journal: Journal of Economic Behavior and Organization

Year: 2022

Volume: 202

Pages: 119-130

Print publication date: 01/10/2022

Acceptance date: 01/08/2022

ISSN (print): 0167-2681

ISSN (electronic): 1879-1751

Publisher: Elsevier

URL: https://doi.org/10.1016/j.jebo.2022.08.006

DOI: 10.1016/j.jebo.2022.08.006

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