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arXiv · 2210.04418

Making Information More Valuable

Mark Whitmeyer
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Abstract

We study what changes to an agent's decision problem increase her value for information. We prove that information becomes more valuable if and only if the agent's reduced-form payoff in her belief becomes more convex. When the transformation corresponds to the addition of an action, the requisite increase in convexity occurs if and only if a simple geometric condition holds, which extends in a natural way to the addition of multiple actions. We apply these findings to two scenarios: a monopolistic screening problem in which the good is information and delegation with information acquisition.

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Mark Whitmeyer. 2022-10-10. Making Information More Valuable. https://arxiv.org/abs/2210.04418

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