Robust predictions and hard information in the market for lemons

Yusuke Yamaguchi and Takuro Yamashita

Economics Letters, 2025, vol. 256, issue C

Abstract: The literature on informationally robust predictions has focused mostly on soft information. In a stylized adverse selection model, we show that hard information enables trade, even when the unique equilibrium outcome without it is no-trade.

Keywords: Hard information; Evidence; Market for lemons (search for similar items in EconPapers)
JEL-codes: D42 D82 D83 L12 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:256:y:2025:i:c:s0165176525004057

DOI: 10.1016/j.econlet.2025.112568

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