The Economic Value of Information

This is a book about the evaluation and choice of information sources by individuals and the design and management of information systems by organizations. The book studies the determinants of the value and cost of information, both to the individual and to the organization, provides techniques for the assessment of the value of information and the comparison of informativeness among alternative sources, and presents principles for the optimal design and management of information systems. Examples are provided to demonstrate the underlying concept.

Inhalt

1. Introduction and Overview.- 1.1 Information in Decision Making.- 1.2 Information in the Organization.- 1.3 Economics of the Incorporation of Information.- 1.4 The Expected Value of an Information Source.- 1.5 Information Value, Cost, and Procurement.- 1.6 System Design for Information Gain.- 1.7 Information Social Science.- 2. The Value of the Informed Decision.- 2.1 Elements of a Decision Problem Under Uncertainty.- 2.2 The Framing of the Decision Problem.- 2.3 Useful Facts About Statistical Information.- 2.4 Value of the Informed Decision.- 3. Measures of the Value of Information.- 3.1 Measures of the Value of a Message.- 3.2 Measures of the Value of a Source.- 4. The Assessment of Statistical Information.- 4.1 Coherent Assessment of Probability Distributions.- 4.2 Assessment of Beliefs and Foreknowledge.- 4.3 Simplifying the Assessment.- 5. Models with Convenient Assessment and Interpretation.- 5.1 Models with Payoff Quadratic in the Action.- 5.2 Models with Payoff Linear in the State.- 5.3 Models with Concave-Exponential Utility.- 5.4 Models with Nonseparable Outcome; Betting and Investing Models.- 5.5 Models with Multicategorical State Description.- 5.6 Dynamic Models and the Role of Timeliness.- 5.7 Approximations and Bounds for the Value of Information.- 6. Statistical Determinants of Information Value.- 6.1 The Normal Form of Decision Analysis.- 6.2 Comparative Informativeness.- 6.3 Informativeness, Prior Knowledge, and Value.- 7. Stochastic Preference and Information Value.- 7.1 Prospects and Attitude Towards Risk.- 7.2 Risk Preference and Information Value.- 8. Information Demand and Procurement.- 8.1 The Demand for Information.- 8.2 Information Procurement.- 8.3 Optimal Incentive Contracts to Procure Information.- 9. Economics of Valuable Information Systems.- 9.1 Information Use Environments.- 9.2 System Design and Information Gain.- 9.3 Experiments in Ex-Ante Information Behavior.- 9.4 A Decision-Theoretic Model for System Design.- 9.5 Postlude.- References.- Acknowledgments.- Symbol Glossary.- Author Index.