Labels address a market failure—asymmetric information—through costly expenditures borne by consumers, firms, and taxpayers. In this review, we explore when mandatory and voluntary labeling policies may be socially optimal. Although the analysis ostensibly revolves around simple comparisons...

Labels address a market failure - asymmetric information - through costly expenditures borne by consumers, firms, and taxpayers. In this review, we explore when mandatory and voluntary labeling policies may be socially optimal. Although the analysis ostensibly revolves around simple comparisons...