Assurance Information: An Experimental Study

Abstract

In this paper we investigate the market viability of new assurance services
being marketed by accountants. Unlike traditional assurance services, such as financial
statement audits, these services may be marketed directly to individual consumers, may
vary in quality and may take some characteristics of public goods. Our results indicate that
son1e decision-makers will purchase assurance infonnation, but that many will not, even
when priced below its risk neutral expected value. Further, our results suggest information
users do not fully reflect the information's uncertainty in their purchase decisions, and free
riding may occur if information takes some characteristics of a public good. (08, M4)