Information Avoidance, Selective Exposure, and Fake(?) News - A Market Experiment

Katharina Momsen and Markus Ohndorf

VfS Annual Conference 2020 (Virtual Conference): Gender Economics from Verein für Socialpolitik / German Economic Association

Abstract: We investigate if people exploit moral wiggle room in markets when revelation is stochastic and the revealed information is potentially erroneous. In our laboratory experiment, subjects purchase products associated with co-benefits represented as a contribution to carbon offsets purchased by the experimenters. Information on the size of this contribution is unobservable at first, but can be actively revealed by the consumer. In seven treatments, we alter the information structure as well as the perceived revelation costs. We find strong evidence of self-serving information avoidance in treatments with simple stochastic revelation and reduced reliability of the information, representing potentially 'fake' news. The propensity to avoid information increases with the introduction of nominal information costs, which are in fact not payoff-relevant. We conclude that, generally, self-serving information avoidance can arise in market situations if specific situational excuses are present, which could explain the demand for products associated with 'green-washing'.

Keywords: Information avoidance; experiment; carbon offsets; moral wiggle room; green consumption; fake news (search for similar items in EconPapers)
JEL-codes: C91 D12 D64 D89 Q50 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-env, nep-exp and nep-ore
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc20:224637

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