Purchase
The purchase price of information such as the cost of a book or a research report.Search
The cost of locating information. For example, the time required to comparison shop on multiple ecommerce websites.Communications
The time required to communicate or stay up-to-date on communicated messages. For example, an investor is comparing passive investing versus actively investing in a basket of stocks. They consider the cost of due diligence such as reading company press releases and listening to earnings calls.Analysis
The time and expertise required to analyze information. For example, the time required to use company data and information to reach a reasonable valuation estimate for a stock.Automation
The cost of tools that automate data processing and analysis. For example, the cost of a tool that automatically calculates risk estimates for an investment.Development
The cost of developing new information using techniques such as research and experimentation. For example, the cost involved in interviewing a firm's customers to look for risks to their revenue.Travel
The costs of physical travel that may be required to obtain certain types of information. For example, a salesperson who considers the cost of attending an industry event to gain information about competitors and customers.| Overview: Information Costs | ||
Type | ||
Definition | Expenditures of time and money that are required to obtain information. | |
Related Concepts | ||
