Access Restriction

Author Mahenc, Philippe
Source Hyper Articles en Ligne (HAL)
Content type Text
Publisher Oxford University Press (OUP)
File Format PDF
Language English
Subject Keyword Experience Good ♦ Quality ♦ Signaling ♦ Bordeaux Wine ♦ qfin ♦ Quantitative Finance [q-fin]
Abstract 1 er mars 2004 Résumé I show that the presence of informed buyers is necessary but not always sucient for producers to use prices as signals of product quality. A suciently high fraction of informed buyers eliminates the lemons problem. A small fraction of informed buyers mitigates the lemons problem, provided that buyers' prior belief of high quality is suciently pessimistic : price reveals high quality at a signaling cost which increases with market power. However, if buyers' prior belief of high quality is optimistic when the market is poorly informed, then the lemons problem is not overcome.
ISSN 00029092
Educational Use Research
Learning Resource Type Article
Publisher Date 2004-01-01
e-ISSN 14678276
Journal American Journal of Agricultural Economics