Information avoidance: An experimental test of anticipated regret

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One reason people may avoid potentially useful information is to eliminate anticipated regret. We develop a model of anticipated regret and use it to derive predictions about how the accuracy of information and the ability to mitigate negative states of the world affect the decision to be informed. The model predicts that higher information accuracy and more effective mitigation options reduce information avoidance. We test these predictions using a laboratory experiment with a real-effort task and uncertain payoffs. Subjects choose whether to receive free but imperfect information about the state of the world (the piece-rate for the effort task) before deciding on a costly mitigation investment, doing the real effort task, and then learning their final payoff. We vary both the accuracy of the information and the effectiveness of mitigation in a 2×2 between-subjects experimental design. We find that increasing the accuracy of information increases information acquisition. Increasing mitigation effectiveness only increases informedness slightly, and the results are not significant. Overall, our results are consistent with our model of anticipated regret, but decision-making is noisier than predicted.