Signaling in markets with two-sided adverse selection

Douglas Gale

doi:10.1007/PL00004191

Signaling in markets with two-sided adverse selection

Douglas Gale

Research output: Contribution to journal › Article › peer-review

Abstract

The paper analyzes an economy with two-sided adverse selection, focusing on equilibria that satisfy a refinement based on the notion of strategic stability. In the familiar case of one-sided adverse selection, agents reveal all of their private information as long as the contract space is rich enough. However, with two-sided adverse selection, the sufficient conditions for separation are much stronger.

Original language	English (US)
Pages (from-to)	391-414
Number of pages	24
Journal	Economic Theory
Volume	18
Issue number	2
DOIs	https://doi.org/10.1007/PL00004191
State	Published - 2001

Keywords

Adverse selection
Equilibrium
Markets
Rationing
Refinement
Signaling
Strategic stability
Types
Walrasian

ASJC Scopus subject areas

Economics and Econometrics

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10.1007/PL00004191

Cite this

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AB - The paper analyzes an economy with two-sided adverse selection, focusing on equilibria that satisfy a refinement based on the notion of strategic stability. In the familiar case of one-sided adverse selection, agents reveal all of their private information as long as the contract space is rich enough. However, with two-sided adverse selection, the sufficient conditions for separation are much stronger.

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KW - Markets

KW - Rationing

KW - Refinement

KW - Signaling

KW - Strategic stability

KW - Types

KW - Walrasian

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Signaling in markets with two-sided adverse selection

Abstract

Keywords

ASJC Scopus subject areas

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