More effort with less pay: On information avoidance, optimistic beliefs, and performance

Steffen Huck, Nora Szech and Lukas M. Wenner

Discussion Papers, Research Unit: Economics of Change from WZB Berlin Social Science Center

Abstract: Recent behavioral models argue in favor of avoidance of instrumental information. We explore the role of information avoidance in a real-effort setting. Our experiment offers three main results. First, we confirm that preferences for avoidance of instrumental information exist, studying information structures on performance pay. Second, information avoiders outperform information receivers. This result holds independently of effects of self-selection. Third, the findings support theories on information avoidance that favor an optimistic belief design rather than theories that rationalize such behavior as a way to mitigate selfcontrol problems. This suggests that coarse information structures lead agents to distort their beliefs away from the objective prior.

Keywords: optimal expectations; belief design; performance; real effort task; coarse incentive structures; workplace incentives (search for similar items in EconPapers)
JEL-codes: D83 D84 J31 M52 (search for similar items in EconPapers)
Date: 2017, Revised 2017
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-hrm, nep-lma, nep-neu and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Journal Article: More effort with less pay: On information avoidance, optimistic beliefs, and performance (2025)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:wzbeoc:spii2015304r2

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