Spies, Search, and the Economics of Information

In the search for information, we tend to continue our search so long as the expected incremental benefits exceed the expected incremental costs of additional search. This basic premise applies to all sorts of things:

• When searching for a new household appliance we might want to purchase, we don't "shop 'til we drop." Instead, we acquire some information about price and quality, inter alia, and then we stop looking at some point. We implicitly say, "the expected incremental benefits of additional search are exceeded by the expected incremental costs." Ms. Eclectic hates it when I talk like that. But we all tend to behave as if we are making that assessment.
• When searching for something we have misplaced, we do the same thing: we search so long as the expected benefits of continued search outweigh the expected costs.

And the list of applications goes on and on.... cars, jobs, mates, one-night stands, etc.

But now we learn that possibly the search for information by US spy agencies has gone beyond the optimal amount of search. At least that is the implication of this piece in the NYTimes:

As the military rushes to place more spy drones over Afghanistan, the remote-controlled planes are producing so much video intelligence that analysts are finding it more and more difficult to keep up.

It looks from the details in this article as if the spies are gathering more information than they can possibly use. At the same time, though, what would be the expected political costs of cutting back on spy-drone data collection?

• It may very well be that the data collection process has political benefits. 
• And the use of spy-drones may also have some deterrent effects on the enemy, making it less likely and/or more costly for them to engage in actions that spy drones could detect, even if not all spy-drone information is examined.

Comments

[JH]

I liked the example of one night stands.

I would agree that the spy drones would have a deterrent effect. Much like the fake videocameras they put in stores to prevent shoplifting.

By that logic it would make sense to fly the drones low so the "terrorists" won't miss spotting them. (though I'm not sure how easy they are to shoot down)