At the core, information is only truly transmitted when the person receiving the intelligence enjoys a change in posterior thinking relative to prior beliefs. Within this transmission, there are two main categories: degenerate and non-degenerate.
Understandably, these terms carry a loaded meaning in the financial ecosystem. However, from a mathematical and decision-theoretic standpoint, the distinction comes down to information quality. Essentially, a degenerate decision rule is one that ignores state information and always produces the same action. In effect, degenerate rules are rules in the formal sense but they’re not informative.
