Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/235005 
Year of Publication: 
2020
Series/Report no.: 
Discussion Paper Series No. 682
Publisher: 
University of Heidelberg, Department of Economics, Heidelberg
Abstract: 
The standard Bayesian model implies that information can never have a negative value. We put this implication to the proof. Our paper provides the first test of the value (positive or negative) of information under uncertainty. We show that the "Bayesian implication" stands in conflict with the information-averse behavior that is revealed in our experiment. This behavior demonstrates that the value of truthful and unambiguous information may indeed be negative. Our findings complement predictions from recent theoretical work in showing that negative value of information correlates with ambiguity aversion. This highlights the importance of counseling for decision-making under uncertainty.
Subjects: 
Value of Information
Ambiguity Aversion
Ellsberg paradox
Ellsberg urn
JEL: 
D81
D83
D90
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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