Machine Learning

, Volume 95, Issue 1, pp 71–86

Collaborative information acquisition for data-driven decisions

Article

DOI: 10.1007/s10994-013-5424-x

Cite this article as:
Kong, D. & Saar-Tsechansky, M. Mach Learn (2014) 95: 71. doi:10.1007/s10994-013-5424-x

Abstract

Data-driven predictive models are routinely used by government agencies and industry to improve the efficiency of their decision-making. In many cases, agencies acquire training data over time, incurring both direct and opportunity costs. Active learning can be used to acquire particularly informative training data that improve learning cost-effectively. However, when multiple models are used to inform decisions, prior work on active learning has significant limitations: either it improves the accuracy of predictive models without regard to how accuracy affects decision making or it addresses only decisions informed by a single predictive model. We propose that decisions informed by multiple models warrant a new kind of Collaborative Information Acquisition (CIA) policy that allows multiple learners to reason collaboratively about informative acquisitions. This paper focuses on tax audit decisions, which affect a vital revenue source for governments worldwide. Because audits are costly to conduct, active learning policies can help identify particularly informative audits to improve future decisions. However, existing active learning models are poorly suited to audit decisions, because audits are best informed by multiple predictive models. We develop a CIA policy to improve the decisions the models inform, and we demonstrate that CIA can substantially increase sales tax revenues. We also demonstrate that the CIA policy can improve decisions to target directly individuals in a donation campaign. Finally, we discuss and demonstrate the risks for decision making of the naive use of existing active learning policies.

Keywords

Active learning Predictive modeling Decision making Audit selection Direct targeting Tax audit 

Copyright information

© The Author(s) 2013

Authors and Affiliations

  1. 1.AustinUSA
  2. 2.Information, Risk and Operations Management, McCombs School of BusinessThe University of Texas at AustinAustinUSA