1987•Probability in the Engineering and Informational SciencesRequires access
The Demand for Information and the Distribution of Income
Kenneth J. Arrow
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Abstract
Investors can increase their payoff by acquiring information on rates of return. The value of the information is greater, the greater the amount to be invested. Therefore, information purchased and consequently the expected rate of return increases with initial wealth, and the distribution of final wealth is more unequal than that of initial wealth.