Uninformed Winners Under Adverse Selection

Max Blouin

Cahiers de recherche from CIRPEE

Abstract: This paper presents a static model of a market for a quality-differentiated good. In one version quality is observable, in the other it is not. It is shown that some agents who are uninformed when quality is unobservable may have higher utility than they do when it is observable. This is more likely to happen when goods of intermediate quality are scarce.

Keywords: Adverse selection; uninformed agents (search for similar items in EconPapers)
JEL-codes: D82 (search for similar items in EconPapers)
Date: 2004
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Persistent link: https://EconPapers.repec.org/RePEc:lvl:lacicr:0431

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