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Learning to hesitate

Published online by Cambridge University Press:  14 March 2025

Ambroise Descamps ,
Sébastien Massoni Open the ORCID record for Sébastien Massoni [Opens in a new window]  and
Lionel Page Open the ORCID record for Lionel Page [Opens in a new window]
Ambroise Descamps*
Affiliation:
Oxera Consulting LLP, Brussels, Belgium
Sébastien Massoni*
Affiliation:
Université de Lorraine, Université de Strasbourg, CNRS, BETA, Nancy, France
Lionel Page*
Affiliation:
Economics Discipline Group, University of Technology Sydney, Ultimo, Australia
*
[email protected]
[email protected]
[email protected]
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Abstract

We investigate how people make choices when they are unsure about the value of the options they face and have to decide whether to choose now or wait and acquire more information first. In an experiment, we find that participants deviate from optimal information acquisition in a systematic manner. They acquire too much information (when they should only collect little) or not enough (when they should collect a lot). We show that this pattern can be explained as naturally emerging from Fechner cognitive errors. Over time participants tend to learn to approximate the optimal strategy when information is relatively costly.

Keywords

SearchDecision under uncertaintyInformationOptimal stoppingReal option

JEL classification

C91: Laboratory, Individual Behavior D81: Criteria for Decision-Making under Risk and Uncertainty D83: Search • Learning • Information and Knowledge • Communication • Belief • Unawareness
Type
Original Paper
Information
Experimental Economics , Volume 25 , Issue 1 , February 2022 , pp. 359 - 383
Copyright
Copyright © 2021 Economic Science Association

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Footnotes

Supplementary Information The online version contains supplementary material available at https://doi.org/10.1007/s10683-021-09718-7.

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