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BSP1005 Lecture Notes 12 - Asymmetric Information PDF

48 Pages·2015·English
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by ['kennerve123']| 2015| 48 pages| English

About BSP1005 Lecture Notes 12 - Asymmetric Information

This document provides an overview of the concept of asymmetric information in economics. It begins with an introduction explaining that asymmetric information occurs when one party in a transaction has more or better information than the other. This can lead to inefficiencies in markets. The document then discusses two specific types of asymmetric information - adverse selection and moral hazard. Adverse selection refers to a situation where one party has private information about their characteristics or "type" that makes the overall pool of participants less desirable. Moral hazard refers to when one party can take actions after a transaction that the other party cannot observe and that impact the first party. Finally, the document outlines ways that markets try to address asymmetric information, such as signaling, screening

Detailed Information

Author:['kennerve123']
Publication Year:2015
Pages:48
Language:English
Format:PDF
Price:FREE
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