What are context-dependent information costs?

Context-dependent information costs are like how much it costs to get something done when you don’t know all the details ahead of time.

Imagine you’re trying to build a tower with blocks. If you know exactly what kind of blocks you have, big ones, small ones, red ones, blue ones, it’s easier to plan your tower. But if you're just told "go build a tower" without any information about the blocks, you might guess wrong and end up using too many big blocks or not enough blue ones. That guessing takes time and energy, that's like information cost.

Sometimes, the cost of guessing depends on what you already know. If you’ve built towers before with those same blocks, it’s easier to guess right this time, so your information cost is lower.

But if you’re building a tower for the first time and don’t know anything about the blocks, you have to try a lot more things, that means your information cost is higher.

It's like learning a new game: if you know the rules already, it’s easier to play. If not, you might need to ask a lot of questions before you get started.