Does the Blockchain Technology Help to Reduce Information Asymmetries

Papatya Duman (), Claus-Jochen Haake (), Alexander Koch (), Sarah Kühn, Simon Hemmrich () and Daniel Beverungen ()
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Papatya Duman: Universität Bielefeld
Claus-Jochen Haake: Universität Paderborn
Alexander Koch: Universität Paderborn
Simon Hemmrich: Universität Paderborn
Daniel Beverungen: Universität Paderborn

No 152, Working Papers Dissertations from Paderborn University, Faculty of Business Administration and Economics

Abstract: We examine the problem faced by a buyer seeking to purchase an experience good without prior knowledge of its stochastic quality. An expert who owns the product can be paid to provide a signal about its quality. Our analysis explores the impact of introducing a credible signaling mechanism for the buyer. Specifically, we propose using blockchain technology, which ensures immutability, decentralization, privacy, and transparency, to store the signal. Our findings reveal that this approach reduces the number of possible equilibria while preserving the “good equilibrium”, in which information is both acquired and accurately transmitted. Consequently, the use of blockchain tech-nology mitigates the equilibrium coordination problem and improves the provision of credible information.

Keywords: Blockchain; Signaling; Asymmetric Information (search for similar items in EconPapers)
JEL-codes: C72 D47 D82 (search for similar items in EconPapers)
Pages: 31
Date: 2025-07
New Economics Papers: this item is included in nep-mic and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:pdn:dispap:152

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