We now appear to live in both the information age, with an ever-increasing abundance of data, and a world that some people refer to as post-truth, where emotional appeals have come to replace facts (particularly in politics). On the surface, this may appear paradoxical. In standard economics, humans are rational agents who revise their beliefs based on new information they receive. More information means better knowledge and better decisions. Psychology, behavioral economics and honest introspection, however, suggest that people often don’t live up to this ideal.

According to the behavioral economist George Loewenstein, there is a new emerging ‘economics of information’, which is about belief-based utility. It suggests that pleasures and pains are “in the mind” and “people are motivated to hold certain beliefs because they feel good or fit into the sense they have made of the world”. One issue studied by researchers in this economics of information is privacy – people choosing not to share information. Another core concept of interest is information avoidance. Sometimes people choose not to obtain knowledge even if having the information would be to their own benefit.

How does information avoidance occur?

According to Russell Golman and his colleagues at Carnegie Mellon University, active information avoidance occurs when access to the information is free and people are aware that it is available. Active information avoidance comes in different forms. The most readily apparent one is physical avoidance. In behavioral finance, for example, research has shown that investors are less likely to check their portfolio online when the stock market is down than when it is up. This has been termed the ostrich effect. More serious cases of physical avoidance happen when people fail to return to clinics to get medical test results, for instance.

People may also avoid information by simply not paying proper attention to the information at hand. Another common form of avoidance involves the biased interpretation of information, such as accepting information that bolsters one’s political beliefs and dismissing information that does not. Even forgetting can be the result of an active process when people fail to rehearse (negative) information.

Why does information avoidance occur?

According to Golman et al., information avoidance is often driven by hedonic factors, such as reducing anxiety, aversion to regret or the need to stay optimistic. But it can also be strategic. For example, an athlete might avoid information about competitors, because she fears that the information would make it difficult to keep up the motivation needed to train for an event. Or a  taxpayer who believes that he is entitled to a tax deduction may choose not to get the advice of an accountant who may try to convince him otherwise.

Information avoidance in the information age

Golman and his co-authors note that information avoidance has immediate benefits for people if it prevents the negative (usually psychological) consequences of knowing the information. From the perspective of economics, it also carries negative utility, especially in the longer term, because it deprives people of potentially useful information for decision making and feedback for future behavior. Furthermore, information avoidance can contribute to a polarization of political opinions and media bias.

George Loewenstein argues that a better understanding of the hedonics of information would be beneficial to the discipline of economics in the information age. This is an important point and raises interesting questions about the effect of both information quality and quantity on avoidance. One study seems to suggest that exposure to more information makes it more likely for people to seek information that is consistent with a prior decision. In some cases, the social media may reinforce individuals’ own biases and the polarization of opinions through selective exposure.

Are you an ostrich?

Imagine you were asked to teach a class and were told that your performance would be evaluated by students on RateMyTeachers.com or RateMyProfessors.com. Would you go to the website and read reviews about your performance? Naturally, the answer to this question would depend on a host of factors ranging from your level of curiosity to self-confidence. Information avoidance is particularly pertinent when ego threat is involved. In addition, you’d also consider the feedback more important if you were thinking about actually embarking on a teaching career than if you considered teaching a class a one-off event. Once you’ve taken into account all other relevant factors, you’re left with a trait that could be called your ‘ostrichity”, at least in relation to this particular situation.

For economists, the ultimate “proof” that you’re an information avoider or ostrich would be evident in your willingness to pay to avoid information. In an experiment conducted a couple of years ago, 7% of participants were willing to sacrifice a $10 reward to avoid obtaining herpes simplex 1 (HSV-1) test results. 12% were willing to forgo this amount for the genital herpes (HSV-2) test.

As a thought experiment, ask yourself how much, if anything, you’d be willing to pay to avoid potentially negative information in each of the following scenarios:

  • Knowing whether or not you will win an important competitive event that you’re currently preparing for (assume it were possible): $_____
  • Learning your attractiveness rating (out of 10), given by your work colleagues: $_____
  • Watching a video of yourself giving a talk (while other people are present): $_____
  • Reading a newly published paper that you suspect may refute the core thesis of an essay you’ve worked on for the last three months: $_____
  • Knowing whether your favorite fashion brand uses child labor: $_____
  • Seeing the balance of your retirement mutual fund the day after the stock market took a significant hit: $_____
  • Finding out whether or not you carry the same gene as one of your parents for a terminal neurological disorder with a 50% likelihood of getting the condition: $_____

How much did you spend?


Golman, R., Hagmann, D., & Loewenstein, G. (In press). Information avoidance. Journal of Economic Literature. (Read the original working paper here

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