On the value of information in a strategic conflict

Abstract

We consider a situation in which an agent M (the "maven") possesses information relevant to the players of an n-person game in which he is not a participant. We define the "inducible set" as the set of ah outcomes which can be made unique Nash equilibria of a game resulting from the maven's transmission of information. This inducible set is a formal expression of M's ability to manipulate the game. We demonstrate some properties of the inducible set and characterize it for 2-person zero-sum games. Finally, we define the notion of the "value of information" possessed by M and provide an explicit formula to calculate this value in terms of the inducible set. Journal of Economic Literature Classification Number: 026. o 1990 Academic press. IK.

On the (Mis-) Use of Information for Public Debate

“…This result is intuitive but not obvious since in games more information is not necessarily bene…cial, not even for the player who holds it (see, e.g., Bassan, Scarsini, Zamir, 1997). However, as Kamien, Tauman and Zamir (1990) have pointed out, "it is not the information itself that harms player 1 [the informed player] but the fact that player 2 knew that he had it" (p. 133). In our case, q is not publicly known.…”

What restrictions do Bayesian games impose on the value of information?

“…Hirshleifer (1971) showed that in economic situations additional information does not necessarily imply greater payoffs for the agent. In the games analyzed by Kamien et al (1990aKamien et al ( , 1990b players receive signals from an outside agent. They showed that the impact of more informative messages on equilibrium payoffs is sometimes strictly negative.…”

Information and Beliefs in Game Theory

“…Contrary to decision-making against nature, the ex ante information value in games may well be negative for some player (Kamien-Taumann-Zamir, 1990). More precisely, when one of two players receives a message, all combinations of signs of information value may be obtained: both may become better, both may become worse, the receiver may become better and the other worse, the receiver may become worse and the other better.…”