Valuing Information

Information, we all want more of it to enable better decision making, but how much should we pay for it? There are always costs involved in getting more information - real monetary costs, as well as lost opportunities. Ken Williams, Mitchell Eaton and David Breininger recently published an article outlining in detail how to calculate various forms of the value of information. Here's the abstract:

The value of information is a general and broadly applicable concept that has been used for several decades to aid in making decisions in the face of uncertainty. Yet there are relatively few examples of its use in ecology and natural resources management, and almost none that are framed in terms of the future impacts of management decisions. In this paper we discuss the value of information in a context of adaptive management, in which actions are taken sequentially over a timeframe and both future resource conditions and residual uncertainties about resource responses are taken into account. Our objective is to derive the value of reducing or eliminating uncertainty in adaptive decision making. We describe several measures of the value of information, with each based on management objectives that are appropriate for adaptive management. We highlight some mathematical properties of these measures, discuss their geometries, and illustrate them with an example in natural resources management. Accounting for the value of information can help to inform decisions about whether and how much to monitor resource conditions through time.

This article is essential reading for anyone wanting to discuss the value of information in ecological management.
And in other news, it turns out that more information is not always better for starlings pecking colored keys to get their food:

Both human and nonhuman decision-makers can deviate from optimal choice by making context-dependent choices. Because ignoring context information can be beneficial, this is called a “less-is-more effect.” The fact that organisms are so sensitive to the context is thus paradoxical and calls for the inclusion of an ecological perspective. In an experiment with starlings, adding cues that identified the context impaired performance in simultaneous prey choices but improved it in sequential prey encounters, in which subjects could reject opportunities in order to search instead in the background. Because sequential prey encounters are likely to be more frequent in nature, storing and using contextual information appears to be ecologically rational on balance by conditioning acceptance of each opportunity to the relative richness of the background, even if this causes context-dependent suboptimal preferences in (less-frequent) simultaneous choices. In ecologically relevant scenarios, more information seems to be more.

So, past experience with context is good for sequential choices, but bad for simultaneous choices. This "less is more" effect would contribute to differences among stakeholders in preferences between options; we're almost always making simultaneous comparisons rather than sequential ones in AM.  Thanks to Gregory Breese for passing along the starling link.