Presentation at ESA World Meeting 2023

Abstract

Information about the consequences of our consumption choices can be unwelcome, and people sometimes avoid it. We investigate an situation where one person possesses information that is inconvenient for another, and study why and when they decide to transmit that information. In our experimental game, a sender can inform a receiver at a small cost about a negative externality associated with a tempting and profitable action for the receiver. We find that some senders transmit more information for large negative externalities. Senders are unresponsive to the receiver’s preferences, as they largely ignore requests for information or information avoidance, even if the receiver can punish the sender afterwards. Sender’s decisions are largely driven by their own preferences for information.