We model competition for a multi-attribute health service where patients observe attribute quality imprecisely before deciding on a provider. High quality in one attribute, e.g. medical quality, is more important for ex post utility than high quality in the other attribute. Providers can shift...

We consider a market for lemons in which the seller is a monopolistic price setter and the buyer receives a private noisy signal of the product's quality. We model this as a game and analyze perfect Bayesian equilibrium prices, trading probabilities and gains of trade. In particular, we vary the...

We consider a market for lemons in which the seller is a monopolistic price setter and the buyer receives a private noisy signal of the product’s quality. We model this as a game and analyze perfect Bayesian equilibrium prices, trading probabilities and gains of trade. In particular, we vary...

Elementary consumer theory assumes that prices affect demand only because they affect the budget constraint (BC). By contrast, several models suggest that prices can affect demand through other channels (e.g. because they signal quality). This alternative conjecture is consistent with evidence...

Secondary markets have adopted a number of quality signaling mechanismssuch as certification to reduce information asymmetries between buyersand sellers in these markets. However the importance and value of thesesignals depends on the nature and extent of information asymmetries.With the growth...