Jeffrey Ely

Jeff Ely is the Charles E. and Emma H. Morrison Professor of Economics at Northwestern University and an accomplished latte-artist. He is co-director of the Center for Economic Theory, a member of several editorial boards and co-author of the blog Cheap Talk.

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1

Apr

Suspense and Surprise

We model demand for non-instrumental information, drawing on the idea that people derive entertainment utility from suspense and surprise. A period has more suspense if the variance of the next period’s beliefs is greater. A period has more surprise if the current belief is further from the last period’s belief. Under these definitions, we analyze the optimal way to reveal information over time so as to maximize expected suspense or surprise experienced by a Bayesian audience. We apply our results to the design of mystery novels, political primaries, casinos, game shows, auctions, and sports.

 

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Jeffrey Ely

Jeff Ely is the Charles E. and Emma H. Morrison Professor of Economics at Northwestern University and an accomplished latte-artist. He is co-director of the Center for Economic Theory, a member of several editorial boards and co-author of the blog Cheap Talk.

Click here to blast this page, Asteroids style. Space bar fires, arrows move.

1

Apr 2013

Suspense and Surprise

We model demand for non-instrumental information, drawing on the idea that people derive entertainment utility from suspense and surprise. A period has more suspense if the variance of the next period’s beliefs is greater. A period has more surprise if the current belief is further from the last period’s belief. Under these definitions, we analyze the optimal way to reveal information over time so as to maximize expected suspense or surprise experienced by a Bayesian audience. We apply our results to the design of mystery novels, political primaries, casinos, game shows, auctions, and sports.

 

Download


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>