Computing the value of information of quadratic decision problems and its non-negativity conditions. (3rd August 2017)

• Record Type: Journal Article
• Authors: Flores-Bazán, Fabián; Laengle, Sigifredo
• Is Part Of: Optimization. Volume 66:Number 8(2017)
• Page Start: 1337
• Page End: 1358
• Publication Date: 2017-08-03
• Subjects: Information structure -- decision problem -- Nash equilibrium -- value of information; 62B10 -- 93C41 -- 91B44; Mathematical optimization -- Periodicals; 519.7
• DOI: 10.1080/02331934.2016.1252916
• Languages: English
• ISSNs: 0233-1934

Abstract

Abstract: There are many examples in the literature of non-cooperative games in which players prefer not to have additional information in order to improve their payoff. We present a general quadratic game in which, if one of the players improves his payoff upon obtaining more information, the other player's payoff worsens in such a way that there is a net social loss due to having more information. How can we ensure this does not occur? The results of this paper are (1) the mathematical expression of the (social) value of information in a quadratic non-cooperative game, and (2) the conditions that ensure the social value of information is non-negative.