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Two-sided certification : the market for rating agencies
Fasten, Erik R.; Hofmann, Dirk - 2010
Certifiers contribute to the sound functioning of markets by reducing a symmetric information. They, however, have been heavily criticized during the 2008-09 financial crisis. This paper investigates on which side of the market a monopolistic profit-maximizing certifier offers his service. If...
Persistent link: https://www.econbiz.de/10008822613
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Two-sided certification : the market for rating agencies
Fasten, Erik R.; Hofmann, Dirk - 2010
Certifiers contribute to the sound functioning of markets by reducing asymmetric information. They, however, have been heavily criticized during the 2008-09 financial crisis. This paper investigates on which side of the market a monopolistic profit-maximizing certifier offers his service. If the...
Persistent link: https://www.econbiz.de/10003952828
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Market-Minded Informational Intermediary and Unintended Welfare Loss
Xu, Wenji; Yang, Kai Hao - 2022
This paper examines the welfare effects of informational intermediation. A (shortlived) seller sets the price of a product that is sold through a (long-lived) informational intermediary. The intermediary can disclose information about the product to consumers, earns a fixed percentage of the...
Persistent link: https://www.econbiz.de/10013295534
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"Download for free" : when do providers of digital goods offer free samples?
Boom, Anette - 2004
In a monopoly setting where consumers cannot observe the quality of the product we show that free samples which are of a lower quality than the marketed digital goods are used together with high prices as signals for a superior quality if the number of informed consumers is small and if the...
Persistent link: https://www.econbiz.de/10010343967
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Asymmetric Information, Reputation, and Welfare in Online Credit Markets
Xin, Yi - 2020
This paper studies the welfare impact of reputation/feedback systems in markets where both adverse selection and moral … reputation system is implemented, I find that 95 percent of total welfare loss from asymmetric information is eliminated. I also … consider a policy intervention that protects borrowers from accidental loss of reputation. My results suggest that introducing …
Persistent link: https://www.econbiz.de/10012836435
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Three essays in microeconomics
Hofmann, Dirk - 2012
Persistent link: https://www.econbiz.de/10009674042
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Optimal degree of public information dissemination
Cornand, Camille; Heinemann, Frank - 2006
Financial markets and macroeconomic environments are often characterized by positive externalities. In these environments, transparency may reduce expected welfare from an ex-ante point of view: public announcements serve as a focal point for higher-order beliefs and affect agents' behaviour...
Persistent link: https://www.econbiz.de/10010366530
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Non-Comparative Versus Comparative Advertising of Quality
Emons, Winand - 2012
Two firms produce a good with a horizontal and a vertical characteristic called quality. The difference in the unobservable quality levels determines how the firms share the market. We consider two scenarios: in the first one, firms disclose quality; in the second one, they send costly signals...
Persistent link: https://www.econbiz.de/10013113303
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The Informational Benefit of Price Discrimination
Gendron-Saulnier, Catherine; Santugini, Marc - 2014
We consider a monopoly supplying a homogeneous good to two separate markets with different demands. In one of the markets, some buyers do not know the quality of the good, but learn about it from observing prices. Under noisy demand, third-degree price discrimination is shown to alter the...
Persistent link: https://www.econbiz.de/10014155280
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Revisiting the Lemons Market
Kessler, Anke S. - 2001
This paper extends the standard competitive adverse selection model by allowing for qualitatively different information structures of agents on the informed side of the market. Using the stylized framework of the market for used cars, we examine the welfare properties of equilibria under the...
Persistent link: https://www.econbiz.de/10014139591