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Suspense and Surprise

Jeffrey Ely, Alexander Frankel and Emir Kamenica

Chapter 8 in Bayesian Persuasion, 2025, pp 177-232 from World Scientific Publishing Co. Pte. Ltd.

Abstract: We model demand for noninstrumental information, drawing on the idea that people derive entertainment utility from suspense and surprise. A period has more suspense if the variance of the next period’s beliefs is greater. A period has more surprise if the current belief is further from the last period’s belief. Under these definitions, we analyze the optimal way to reveal information over time so as to maximize expected suspense or surprise experienced by a Bayesian audience. We apply our results to the design of mystery novels, political primaries, casinos, game shows, auctions, and sports.

Keywords: Bayesian Persuasion; Economic Theory; Information Economics; Information Design; Disclosure; Game Theory; Strategic Communication; Disclosure Regulation; Persuasion Games; Political Economy; Economic Behavior; Information Revelation; Collusion; Competition; Congestion; Manipulation of Beliefs; Rating Systems; Optimization (search for similar items in EconPapers)
JEL-codes: C01 C72 D82 D83 (search for similar items in EconPapers)
Date: 2025
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