General Equilibrium Model with Information Asymmetry and Commodity-Information Technologies

In this paper, we investigate a new concept of a market's commodity-information structure (a partition of the set of real goods that are treated as one commodity for market exchanges) and technologies relat- ing to it, commodity-information technologies. Using this concept, we can always affirmatively answer the market viability problem, concerning the existence of general equilibrium even when information asymmetry among agents such as adverse selection prevails in the economy. Some Pareto-optimality problems and policy implications are also discussed.