Lecture title: Regret and Information Avoidance

Speaker: Dr. Wang Zichang, Assistant Professor
Wang Yanan Institute for Studies in Economics (WISE) & School of Economics, Xiamen University

Time: 10:00 AM, March 31, 2025 (Monday)

Venue: Room 210, School of Economics and Management

Abstract:

Empirical evidence suggests that individuals selectively avoid information depending on past choices. We address these findings by studying an agent whose choice behavior can be modeled as if she trades off two conflicting effects of information. The first is a novel psychological cost from the regret about past choices that are revealed to be suboptimal, whereas the second is the instrumental value of information for making better-informed choices in the future. Our main axioms reflect the agent’s desire to limit her options before the arrival of information and to have more options after the arrival of information. We also posit axioms that connect the agent’s consumption choice with her information choice. We show that all parameters can be uniquely identified from the choice behavior. Comparative statics on the agent’s information aversion attitude is also provided.

Zichang Wang is currently an assistant professor at WISE and the School of Economics at Xiamen University. Prior to joining Xiamen University, he obtained his PhD from Duke University. His main research interest is on microeconomic theory, with an emphasis on decision theory, behavioral economics and information economics. He has published a paper on Journal of Economic Theory.