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Product Quality, Consumer Information and "Lemons" in Experimental Markets

Lynch, Michael and Miller, Ross M. and Plott, Charles R. and Porter, Russell (1986) Product Quality, Consumer Information and "Lemons" in Experimental Markets. In: Empirical Approaches to Consumer Protection Economics. Federal Trade Commission , Washington, DC, pp. 251-306. https://resolver.caltech.edu/CaltechAUTHORS:20140325-113859023

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Abstract

This paper reports on the behavior of experimental markets wherein buyers were ignorant (unless truthfully informed by sellers) of the quality of the product purchased. True quality of the product was learned only after the sale. Sellers chose quality or "grade" and higher quality was more costly to produce. Our experimental markets were characterised by asymmetric information possessed by buyers and sellers who traded a pure "experience" good whose quality was endogenously determined.


Item Type:Book Section
Additional Information:© 1986 FTC.
Record Number:CaltechAUTHORS:20140325-113859023
Persistent URL:https://resolver.caltech.edu/CaltechAUTHORS:20140325-113859023
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:44499
Collection:CaltechAUTHORS
Deposited By: Susan Vite
Deposited On:02 Apr 2014 20:50
Last Modified:03 Oct 2019 06:18

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