The value of information

- Information has value, and it's important to know how much information is worth so that we can decide whether to invest in gathering that information. Very detailed estimation is an example, in many cases, of over-investing compared to the value of the information that you gather through that exercise. Before you do work to gather information, always know the value of that information so that you know how much effort and time and cost to expend in gathering it. How do we think about the value of information? Well, one of my favorite books on measurement and information is Douglas Hubbard's book "How to Measure Anything." And in that book, he talks about the value of information, and he says that information has value in three different ways. Number one, information reduces uncertainty about decisions that have economic consequences. This is why we care about information for investment decisions, for example. Second…