Rational inattention or rational overreaction? Consumer reactions to health news

Research output: Working paperResearch

We investigate differences in how consumers of fish react to health information in the mass media. We specify a dynamic empirical model that allows for heterogeneity in all basic parameters of consumer behavior as well as in how consumers react to information. We estimate the model using a unique houshold panel tracking consumption, prices, news stories and media habits over 24 quarters. We fi nd that the consumers most likely to be ’rationally ignorant’ of health effects react more dramatically to health news than the consumers who most likely are well informed.
Original languageEnglish
Place of PublicationFrederiksberg
PublisherDepartment of Food and Resource Economics, University of Copenhagen
Number of pages29
Publication statusPublished - 2013
SeriesIFRO Working Paper
Number2013/14

ID: 54585817