Costly Information Revealed by Beliefs: A More Direct Test of Rational Inattention Models

Last registered on April 19, 2026

Pre-Trial

Trial Information

General Information

Title
Costly Information Revealed by Beliefs: A More Direct Test of Rational Inattention Models
RCT ID
AEARCTR-0015667
Initial registration date
April 21, 2025

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
May 02, 2025, 5:49 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Last updated
April 19, 2026, 1:29 AM EDT

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Region

Primary Investigator

Affiliation
UNSW

Other Primary Investigator(s)

PI Affiliation
Ohio State University
PI Affiliation
Ohio State University

Additional Trial Information

Status
On going
Start date
2025-04-15
End date
2027-05-31
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
We design an experiment to document the validity of rational inattention models. Our design evaluates these models in direct (choosing intended posteriors) and natural (choosing information structures) frames. The former frame implements a decision variable closest to the model’s primitives, while the latter is more natural for experimental settings. By observing the acquired information in either frame, we can determine which class of rational inattention models aligns with the decision-making processes in the lab. These frames provide insights into the validity of these classes in rational inattention models, which are often tested solely based on choice data without observing the chosen level of informativeness. Assessing the consistency of their behavior between the two frames allows us to know whether it is without loss of generality that experimental designs may adopt an indirect yet natural decision variable and still make use of models that are ultimately defined on random posterior distributions.
External Link(s)

Registration Citation

Citation
Kim, Suha, Hyeonggyun Ko and Jason Tayawa. 2026. "Costly Information Revealed by Beliefs: A More Direct Test of Rational Inattention Models." AEA RCT Registry. April 19. https://doi.org/10.1257/rct.15667-2.0
Experimental Details

Interventions

Intervention(s)
Experiment 1

The design varies several variables regarding the decision problem of the subject. Each subject is invited to participate in three sessions to do 168 round of a simple guessing task where the guess whether or not the randomly chosen urn for a given round contains a hexagon. Subjects are allowed to gather information about the chosen urn by taking out polygons from the chosen urn. We ask how much information they want to gather, and we vary the frame regarding this question between the three sessions. Within a session, we vary the reward for guessing the chosen urn across the rounds; and we also vary the probability the chosen urn has a hexagon across the rounds. Two rounds are randomly chosen for payment at the end of each session. Please refer to the succeeding research design and study procedures for the details and purpose of variations.

We use different frames and provide more information in succeeding treatments to observe changes in the intended posterior distributions.

Experiment 2

Experiment 2 consists of four parts, following the same decision problem in Experiment 1. Similarly, the design varies several variables regarding the decision problem of the subject. Each subject will do 92 rounds of a simple guessing task where they guess whether or not the randomly chosen urn for a given round contains a hexagon. Subjects are allowed to gather information by taking out polygons from the chosen urn. In all parts, we ask how much information they want to gather, and we vary the frame regarding this question between the first two parts. We vary the reward for guessing the chosen urn across the rounds, and we also vary the probability that the chosen urn has a hexagon across the rounds. In parts 3 and 4, they face similar questions to those in the first half and choose options for levels of information based on their answers in the first two parts. Two rounds are randomly chosen for payment at the end of each session.
Intervention Start Date
2025-04-22
Intervention End Date
2027-05-31

Primary Outcomes

Primary Outcomes (end points)
Random Posterior Distribution: the possible set of beliefs and their corresponding probability over the state space. Elicited as the intended probability that their guess would be correct.

Information Structure: a collection of conditional probabilities over the signal space given the state. Elicited as the number of polygons to be drawn from the unknown urn.

Guess: the subject's guess given their realized signal.

Choice of level of information based on previous answers: some questions about desired informativeness (in terms of random posterior distributions or information structures) may involve options based on the participant's previous answers.

Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Experiment 2

Frame easiness: On a scale of 0-10 (0 extremely difficult to 10 extremely easy), we ask the easiness of answering their desired informativeness given the frame.

Frame preference: We ask which frame is preferred over the other, allowing for indifference.

Frame distinctiveness: On a scale of 0-10 (0 not being different to 10 extremely different), we ask how much they feel that they treat the two frames differently.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Experiment 1

The design varies several variables regarding the decision problem of the subject. Each subject is invited to participate in three sessions to do 168 round of a simple guessing task where the guess whether or not the randomly chosen urn for a given round contains a hexagon. Subjects are allowed to gather information about the chosen urn by taking out polygons from the chosen urn. We ask how much information they want to gather, and we vary the frame regarding this question between the three sessions. Within a session, we vary the reward for guessing the chosen urn across the rounds; and we also vary the probability the chosen urn has a hexagon across the rounds. Two rounds are randomly chosen for payment at the end of each session. Please refer to the succeeding research design and study procedures for the details and purpose of variations.

Experiment 2

Experiment 2 consists of four parts, following the same decision problem in Experiment 1. Similarly, the design varies several variables regarding the decision problem of the subject. Each subject will do 92 rounds of a simple guessing task where they guess whether or not the randomly chosen urn for a given round contains a hexagon. Subjects are allowed to gather information by taking out polygons from the chosen urn. In all parts, we ask how much information they want to gather, and we vary the frame regarding this question between the first two parts. We vary the reward for guessing the chosen urn across the rounds, and we also vary the probability that the chosen urn has a hexagon across the rounds. In parts 3 and 4, they face similar questions to those in the first half and choose options for levels of information based on their answers in the first two parts. Two rounds are randomly chosen for payment at the end of each session.
Experimental Design Details
Not available
Randomization Method
randomization done in office by a computer
Randomization Unit
Individual level
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
Experiment 1: 100 university students

Experiment 2: 100 university students
Sample size: planned number of observations
Experiment 1: 50400 decisions from 100 university students over three session Experiment 2: 27600 decisions from 100 university students
Sample size (or number of clusters) by treatment arms
Experiment 1: 100 university students invited for three sessions

Experiment 2: 100 university students
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Experiment 1 Using data from Tayawa, Ko, and Mahmood (preprint), we calculate several hypothesized coefficients for the effect of the reward level and prior on the chosen level of informativeness. For the effect of a change in reward, the coefficients are 0.1140, 0.1254, 0.1368, and 0.1482 percentage points for priors 0.5, 0.55, 0.6, and 0.65, respectively. For the effect of a change in the prior when the subject is represented by a Prior-Invariant model, the coefficients are -0.0684, -0.1140, -0.1596, -0.2052 percentage points for reward levels 0.3, 0.5, 0.7, and 0.9, respectively. Experiment 2 In addition to the analysis for identifying inattentive behavior as in Experiment 1, we also test the difference in behavior between parts 1 and 2 by running a joint significance test on the change in the slope and intercept parameters for the effect of the prior on the chosen level of informativeness. We also provide additional analysis to identify weakly responsive levels of informativeness in relation to reward. Specifically, we calculate a region of practical equivalence for the estimated coefficient representing the effect of the reward level on the chosen level of informativeness. This interval is [-0.2439, 0.2439]. This interval is determined by imposing an upper bound on the expected utility loss from deviating from the optimal level of informativeness, assuming weak responsiveness is optimal. In particular, the percentage loss is capped at 5% if the participant deviates by at most 0.02439% from optimal informativeness for every 5 percentage-point increase in the reward. Given the parametrization of the payment rule, the expected earnings are at least $20.00, and therefore, the expected loss is capped at $1.00. The same argument and calculations apply to determining the region of practical equivalence for the estimated coefficient representing the effect of the prior when classifying the participant to exhibit a behavior consistent with the Uniform Posterior Separable model. In other words, the interval [-0.2439, 0.2439] ensures that the percentage loss is capped at 5% if the participant deviates by at most 0.02439% from optimal informativeness for every 5 percentage-point increase in the prior. For the analysis of parts 3 and 4, we investigate whether the participant’s choice aligns with consistency in a particular part or is entirely dependent on the frame. This consistency could manifest in either consistently leaning towards direct frame options (part 1) or natural frame options (part 2). We compare this model of consistency to a random choice model (choosing either option with a 50% chance). To provide bounds on how well this random choice model can predict, we simulated it for 102 decisions (34 rounds × 3 decisions per round) at different confidence levels: 90%, 95%, and 99%. For each confidence level, the random choice model can predict at most 59, 61, and 64 options that are consistent with a single frame. Therefore, we use these three threshold numbers of choices consistent with a frame (frame consistency) to reject the random choice model in favor of consistency, which can be weakly or strongly favored. Additionally, we consider the possibility that the participant’s choice aligns with a frame (either part 1 or 2), conditional on their current frame (frame dependence). We use the same threshold numbers of choices that align to a specific frame conditional on the current frame (in part 3 or 4) to reject the random choice model in favor of frame dependence. Finally, we use our secondary measures—frame easiness, preference, and distinctiveness—to gain further insights into changes in information acquisition behavior between parts 1 and 2, as well as the behavior on frame consistency or dependence in parts 3 and 4.
Supporting Documents and Materials

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IRB

Institutional Review Boards (IRBs)

IRB Name
Office of Responsible Research Practices, The Ohio State University Institutional Review Board
IRB Approval Date
2025-04-07
IRB Approval Number
STUDY20250369