Three Essays on Consumption and Information

This dissertation uses theoretical, empirical, and experimental methods to investigate how environmental constraints and psychological mechanisms shape individual consumption and information preference. Chapter 1 explores the impact of COVID-19 lockdown policies on alcohol and tobacco use in the United States. Using data from the 2020 wave of the Behavioral Risk Factor Surveillance System (BRFSS) and exploiting the exogenous variation in initial lockdown orders across states, we estimate the impact of stay-at-home orders on drinking and smoking behaviors for adults in the United States. Combining the propensity score matching method with the difference-in-differences identification strategy, we find that, at least in the short term, lockdown measures increase average number of drinks consumed per day and average number of cigarettes smoked per day by regular smokers. Probing for a potential mechanism through which lockdown orders affect the mentioned consumption behaviors, we show evidence that mentally unhealthy days increase due to the implementation of the lockdown policy. Our findings provide additional evidence that people increase the consumption of alcohol or other psychoactive substances in response to natural or social disruptions. Chapter 2 examines the interaction between information preference and physical consumption, with attention as the mediator. Attention is a limited resource that can be used to enhance the experience of physical consumption and as a necessary input for processing information. This implies that consuming in the present creates an opportunity cost to processing information about the future, and vice versa. We test this in four controlled experiments. We find that increasing consumption in the present decreases demand for information about the future and increases demand for future risk-mitigation. Chapter 3 investigates how meat consumption affects information choice about animal welfare. We run a laboratory experiment to test whether near contemporaneous meat consumption can affect behavior directly through information choice about animal welfare, contributions to an animal charity, and a proxy measure for political behavior. We also test for the indirect effects of meat consumption on our charity outcome and political outcome by way of its effect on information preferences. Though we find that meat consumption changes attitudes towards animals, and information changes charitable contributions, we find that meat consumption does not affect our behavior outcomes. The null result casts doubt on the extent to which shifts in attitudes translate to shifts in behavior. An online hypothetical experiment finds that information preferences are consistent with expected-utility theory, and we again find no evidence of motivated thinking on behavior.