Partnerships, lemons, and efficient trade
نویسندگان
چکیده
منابع مشابه
Decentralized Trade Mitigates the Lemons Problem
In markets with adverse selection, only low-quality units trade in the competitive equilibrium when the average quality of the good held by sellers is low. We show that under decentralized trade, however, both highand low-quality units trade, although with delay. Moreover, when frictions are small, the surplus realized is greater than the (static) competitive surplus. Thus, decentralized trade ...
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By allocating different information to team members, secret contracts can provide better incentives to perform with an intuitive organizational design. For instance, they may help to monitor monitors, and attain approximately efficient partnerships by appointing a secret principal. More generally, secret contracts highlight a rich duality between enforceability and identifiability. It naturally...
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We develop a dynamic equilibrium model of labor demand with adverse selection. Firms learn the quality of newly hired workers after a period of employment. Adverse selection makes it costly to hire new workers and to release productive workers. As a result, firms hoard labor and under-react to labor demand shocks. The adverse selection problem also creates a market for temporary workers. In equ...
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Environmental and labour standards have become an important international trade issue. This article examines and ranks alternative trade policy responses available to an importing country with concerns over such standards. While a full import embargo may sometimes be preferable to allowing unrestricted access to unlabeled non-conforming imports, a partial embargo that allows imports which demon...
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Why are trade barriers often used to protect home producers, even at the cost of introducing deadweight losses from higher commodity prices? We add an informational friction to the standard textbook argument in favor of free trade, and show that trade restrictions may be a more efficient policy than a lump sum transfer to the displaced producers. Trade barriers, while generating deadweight loss...
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ژورنال
عنوان ژورنال: Journal of Economic Theory
سال: 2003
ISSN: 0022-0531
DOI: 10.1016/s0022-0531(03)00109-1