Value of information

Value of information (VOI) is the expected improvement in decision quality from obtaining additional information before acting. Unlike classical information theory, which measures information by its capacity to reduce entropy, VOI measures information by its capacity to change action. A fact that reduces uncertainty but does not change which alternative is optimal has zero value of information — no matter how surprising or elegant the fact may be.

The framework was developed in decision analysis but applies to any domain where information is costly and decisions are consequential. In adaptive management, VOI determines which uncertainties to resolve through experiment and which to accept as irreducible background noise. In scientific funding, it asks which research programmes, if successful, would change policy. The value of information is the bridge between information loss and structured decision making: it tells us which lost information we should mourn and which we could never have used.