Value of Information: Exploring Behavioral and Social Factors

Abstract

There is growing interest within and beyond the economics community in assessing the value of information (VOI) used in decision making. VOI assessments often do not consider the complex behavioral and social factors that affect the perception, valuation, and use of information by individuals and groups. Additionally, VOI assessments frequently do not examine the full suite of interactions and outcomes affecting different groups or individuals. The behavioral and social factors that we mention are often (but not always) innately-derived, less-than-conscious influences that reflect human and societal adaptations to the past. We first discuss these concepts in the context of the recognition and use of information for decision making. We then find fifteen different aspects of value and information pertinent to VOI assessments. We examine methodologies and issues related to current VOI estimation practices in economics. Building on this examination, we explore the perceptions, social factors, and behavioral factors affecting information sharing, prioritization, valuation, and discounting. Information and valuation issues are then considered in the context of information production, information trading and controls, and information communication pathologies. Lastly, we describe issues relating to information useability and actionability. Our examples mention the value and use of geospatial information, and more generally concern societal issues relating to the management of natural resources, environments, and natural and anthropogenic hazards. Our paper aims to be instrumentally relevant to anyone interested in the use and value of science.