The creation of a vast and growing amount of information has led to benefits and drawbacks, as well as the spread of fake news and conspiracy theories. How and why people value information is the focus of new research. Even though information can't be translated into material outcomes, people still get attached to it.
The findings were published in the PNAS.
"We often talk about interacting with information as if we are consuming something, and we describe our attachment to personal beliefs as holding onto or letting go of something," says Christopher Olivola, Associate Professor of Marketing at CMU's Tepper School of Business. Surprisingly little research has been done on how we value information.
Information is valued only if it supports decisions that yield better outcomes. This view doesn't fully explain how individuals engage with information, such as our willingness to pay for information that doesn't impact us in any tangible way, or our tendency to avoid information we don't like.
Gains and losses of information are treated as cherished possessions in three studies. Loss aversion and the endowment effect are related to money and tangible goods, as well as to information.
While the three studies focused on information that was irrelevant to individuals, the authors suggest that the pattern of results they document may also apply to information that is consequential. Implications for situations in which people are encouraged to value useful information can be found in the findings. Understanding whether and when consumers think of personal information as possessions may help guide research and shape policy about online consumer privacy.
In the digital age, when individuals' unprecedented access to information complicates and can change the way we value it, it is important to identify loss aversion and the endowment effect for information.
More information: Yana Litovsky et al, Loss aversion, the endowment effect, and gain-loss framing shape preferences for noninstrumental information, Proceedings of the National Academy of Sciences (2022). DOI: 10.1073/pnas.2202700119 Journal information: Proceedings of the National Academy of Sciences
All Rights Reserved © 2024
