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Good Consumer Information: the Information Paradigm at its (Dead) End?

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Abstract

The traditional information paradigm postulates that increasing the amount of information and establishing full transparency help consumers with their decisions. We challenge this assumption and address criteria that good consumer information needs to fulfil. Based on the findings from research in behavioural economics and finance, necessary conditions for good consumer information include transparency, comprehensibleness, and comparability, whereas quality—in terms of clarity, fit to personal needs, and verifiability—represents the sufficient condition for good consumer information. Information that consumers currently receive hardly fulfils these conditions which, in turn, considerably hampers the trustworthiness and usability of this information. To mitigate consumers’ information problem and to recover the idea of the information paradigm, we suggest to extend the information model and to integrate the idea of collective consumers, to establish product testing principles, and to implement controlled minimum standard for (financial) products.

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Notes

  1. Please note that in the following we will use the term financial products to characterize both financial products and services.

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Acknowledgements

This article is based on Oehler (2015). We would like to thank Hans-W. Micklitz, Lucia Reisch, Joasia Luzak, Peter Kenning, Alberto Alemanno, Fernando Gómez (the editor), two anonymous referees and participants of the workshop “Where is law going if it is not going behavioural?” held at the European University Institute, EUI, Florence, Italy on January 22/23, 2015 for inspiring discussion and helpful comments and suggestions. All remaining errors are our own.

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Authors and Affiliations

  1. Bamberg University, Kaerntenstrasse 7, 96045, Bamberg, Germany

    Andreas Oehler

  2. School of Business, Reykjavik University, Reykjavik, Iceland

    Stefan Wendt

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  1. Andreas Oehler
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  2. Stefan Wendt
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Correspondence to Andreas Oehler.

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Oehler, A., Wendt, S. Good Consumer Information: the Information Paradigm at its (Dead) End?. J Consum Policy 40, 179–191 (2017). https://doi.org/10.1007/s10603-016-9337-5

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