The article argues that research creates value only when information can change a decision, either immediately or through follow-up choices. In a launch example, one customer study is worth $18,000 when favorable and unfavorable results lead to different actions. But when prior confidence is low enough that neither result changes the launch decision, the same study has negative standalone value.

That changes once research becomes sequential. Using backward induction, the model shows that evidence insufficient after one study can still be valuable because it affects whether another study is worth buying. Research therefore has option value, and the optimal stopping point depends on beliefs, signal quality, costs, and available actions. The practical lesson is to define the decision before commissioning more analysis and stop only when further information no longer changes the best action or next worthwhile question.

Last week, I spent several days in Philadelphia for the Annual Meeting of the National Association for Business Economics (NABE). The event brings together economists from central banks, think tanks, corporations, and universities to assess the state of the global economy. The theme this year was Global Economy in Transition: Finding Opportunity Amid Disruption. Sessions explored the pressures shaping global business and policy: geopolitical instability, shifting trade regimes, monetary divergence, and the disruptive force of technology. There were also discussions of long-term structural issues such as climate risk, labor markets, and the balance of economic power.

In 2025, if you asked the average economist about the U.S. labor market, the answer might sound reassuring: the unemployment rate is holding steady around 4%, inflation is relatively under control, and job growth continues month after month. But ask a 23-year-old college graduate with a crisp new diploma and a browser full of unanswered job applications, and you’ll hear a different story.