The value of information and the value of awareness
Recent literature has examined the problem facing decisionmakers with bounded awareness, who may be unaware of some states of nature. A ques- tion that naturally arises here is whether a value of awareness (VOA), anal- ogous to VOI, can be attributed to changes in awareness.In this note it is shown, in a sense that will be made precise, that the sum VOA+VOI is constant and independent of the choice set. It follows that, the greater is VOA, the less is VOI. This point is illustrated for a simple two-state case, then proved for general classes of choice sets. The analysis is then extended to cover altenative concepts of choice under unawareness.
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- Edi Karni & Marie-Louise Vier?, 2013.
""Reverse Bayesianism": A Choice-Based Theory of Growing Awareness,"
American Economic Review,
American Economic Association, vol. 103(7), pages 2790-2810, December.
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- Edi Karni & Marie-Louise Vierø, 2010. ""Reverse Bayesianism": A Choice-Based Theory of Growing Awareness," Working Papers 1258, Queen's University, Department of Economics.
- Simon Grant & John Quiggin, 2013.
"Inductive reasoning about unawareness,"
Springer, vol. 54(3), pages 717-755, November.
- Grant, Simon & Quiggin, John, 2009. "Inductive Reasoning About Unwareness," Risk and Sustainable Management Group Working Papers 151188, University of Queensland, School of Economics.
- Simon Grant & John Quiggin, 2009. "Inductive reasoning about unawareness," Risk & Uncertainty Working Papers WPR09_1, Risk and Sustainable Management Group, University of Queensland.
- Grant, Simon & Quiggin, John, 2012. "Inductive Reasoning About Unwareness," Risk and Sustainable Management Group Working Papers 151202, University of Queensland, School of Economics.
- Heifetz, Aviad & Meier, Martin & Schipper, Burkhard C., 2005.
Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems
52, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
- Halpern, Joseph Y. & Rego, Leandro Chaves, 2008. "Interactive unawareness revisited," Games and Economic Behavior, Elsevier, vol. 62(1), pages 232-262, January.
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