General equilibrium in markets for lemons

Joao Correia-da-Silva

Journal of Mathematical Economics, 2012, vol. 48, issue 3, 187-195

Abstract: This paper studies exchange economies in which agents have differential information about the goods that the other agents bring to the market. To study such a setting, it is useful to distinguish goods not only by their physical characteristics, but also by the agent that brings them to the market. Equilibrium is shown to exist, with agents receiving the cheapest bundle among those that they cannot distinguish from the truthful delivery. An example is presented as an illustration.

Keywords: General equilibrium; Asymmetric information; Adverse selection; Uncertain delivery; Delivery rates (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:mateco:v:48:y:2012:i:3:p:187-195

DOI: 10.1016/j.jmateco.2012.04.002

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