The ambiguity of the concept of flexibility: a Lancasterian approach to decision-making.

Summary The various consequences of a decision on the environment (exogenous or endogenous nature of the environment), on the decision-maker's information system (learning linked to the decision) and on subsequent decisions (future field of choice) lead to the definition of three types of flexibility whose effects on the decision may be antagonistic. The concept of flexibility thus becomes particularly ambiguous, as shown by the two examples of the conservation of plant genetic resources and progressive decontamination in research on genetically modified organisms. In complex cases, attempts to define an option value of flexibility are therefore doomed to failure and it is preferable to value the characteristics of a decision globally, via an objective function calculated over the whole decision tree, such as a sequential net present value (NPV) for financial flows.