版權(quán)說(shuō)明:本文檔由用戶提供并上傳,收益歸屬內(nèi)容提供方,若內(nèi)容存在侵權(quán),請(qǐng)進(jìn)行舉報(bào)或認(rèn)領(lǐng)
文檔簡(jiǎn)介
1、Are you in the market for a vehicle? During the 2007-09 recession, new- vehicle sales plunged to their lowest levels in nearly 30 years. They have since fully recovered as people replace their aging vehicles with shiny n
2、ew cars, trucks, vans, and sport utility vehicles. Prices of new vehicles, however, are at all-time highs, leading many buyers to look for used vehicles. It can be a challenge, though, for buyers to figure out whether th
3、ey are getting a good deal. The seller generally knows far more about the vehicle. Even with careful examination, the buyer still likely won’t know everything the seller knows. When one party knows more about the product
4、 than the other party, there is “asymmetric information.” In the case of a used car, the seller has more information—and the advantage. The opposite can also be true in a transaction—the buyer can have more information a
5、nd the advantage.The Market for LemonsThe used-car market is often used to discuss the implications of asymmetric information. In this market, sellers have greater knowledge about the con- dition and quality of their car
6、s than buyers. For example, a seller is likely to know about engine or transmission problems, the maintenance history, and any defective equipment. In other words, the seller is likely to know whether the car is a “l(fā)emon
7、” (a car with defects). The buyer, however, is at a disadvantage. Even with a careful visual inspection or a test drive, defects can be missed or hidden. The seller is in the driver’s seat (so to speak) in this market.To
8、 better understand asymmetric information, consider a buyer looking for a particular car make and model. Let’s call it the 2012 Econocar Utility Maximizer. The buyer is willing to pay up to $14,000 for a high-quality use
9、d car (a “cherry”) but only $10,000 for a low-quality used car (a lemon). Imagine she visits two sellers advertising 2012 Utility Maximizers. OneWhy Is It So Difficult To Buy a High-Quality Used Car?Scott A. Wolla, Ph.D.
10、, Senior economic education SpecialistGLOSSARYAdverse selection: The tendency of insurance to be purchased by those most likely to make claims. Asymmetric information: A situation where one party to a market transaction
11、has more information about a product or service than the other. The result may be an over- or under-allocation of resources. Moral hazard: The risk that one party to a transaction will engage in behavior that is undesira
12、ble from the other party’s view.Premium: The fee paid for insurance protection.PAGE ONE economics ®September 2016 Federal Reserve Bank of St. Louis | research.stlouisfed.org“I discovered that the informational prob
13、lems that exist in the used car marketwere potentially present to some degree in all markets.”—George A. Akerlof, Nobel Prize winner, 2001before buying a house or car or choosing a college but less important for choosing
14、 a frying pan or a stapler. Other Markets with Asymmetric InformationOther markets also have the challenge of asymmetric information. In the insurance market, for example, buyers usually have more information than seller
15、s (insurance companies). The person wanting health insurance has more information about his or her current health than the insurance company. This imbalance can lead to two potential problems in the health insurance mark
16、et. The first is adverse selection: People with health problems are more likely to buy health insurance than healthy peo- ple, who might decide they don’t need health insurance. This imbalance can create a pool of insure
17、d people with more health problems than the general population. If this is the case, health insurance companies will likely pay more claims and charge higher premiums. The Patient Protection and Affordable Care Act has a
18、ttempted to reduce adverse selection by creating financial incentives to encourage all people (even the young and healthy) to buy insurance.The second potential pitfall is moral hazard: People with insurance tend to take
19、 on more risk (knowing insurance will pay some of the cost if anything bad happens) than they would otherwise. This increase in risky behavior could increase the number of claims insurance compa- nies must pay and result
20、 in higher premiums. Insurance companies attempt to learn about a potential customer’s health and other habits before granting medical or life insurance to reduce the risk to the company and ensure an appropriate monthly
21、 premium is charged. Credit markets also notably feature asymmetric informa- tion problems. A potential borrower has better informa- tion about his or her own ability and willingness to repay a loan than the lender. Lend
22、ers attempt to learn about potential borrowers’ credit and financial history from credit reports. This information improves the ability oflenders to choose whom they should lend to and what interest rate they should char
23、ge.Finally, asymmetric information problems also plague labor markets. Job seekers know more about their own job skills and work ethic than potential employers. Employers generally conduct interviews and check refer- enc
24、es but may also give assessments and seek additional information online, including on social media. In addition, some employers review credit reports,2 require drug test- ing, and/or perform a criminal background check.
25、ConclusionWhen one party to a transaction has more information than the other, the party with more information has the advantage. This circumstance is a problem not only for the party with less information, but also for
26、the market itself as transactions that would have benefited both buy- ers and sellers fail to occur. For example, even though some people are willing to sell high-quality cars for a suitable price, buyers won’t pay top d
27、ollar because they are unable to assess a car’s true condition. So, the car owners won’t sell, and the beneficial transactions never occur. However, the growing availability of information— if you seek it out—may help cl
28、ose the asymmetric infor- mation gap. nNotes1 Rafter, Michelle V. “Decoding What’s In Your Car’s Black Box.” edmunds.com, July 22, 2014; http://www.edmunds.com/car-technology/car-black-box- recorders-capture-crash-data.h
29、tml.2 eleven states have banned the use of credit checks in employment decisions (Traub, Amy and Mcelwee, Sean. “Bad Credit Shouldn't Block employment: How to Make State Bans On employment Credit Checks More effectiv
30、e.” Dēmos, February 25, 2016; http://www.demos.org/publication/bad-credit-shouldnt- block-employment-how-make-state-bans-employment-credit-checks-more-e).PAGE ONE economics® Federal Reserve Bank of St. Louis | resea
31、rch.stlouisfed.org 3Page One Economics® and Page One Economics®: Focus on Finance provide informative, accessible essays on current events in economics and personal finance as well as accompanying teacher editi
32、ons and lesson plans. The essays and lesson plans are published January through May and September through December. Please visit our website and archives http://research.stlouisfed.org/pageone-economics/ for more informa
溫馨提示
- 1. 本站所有資源如無(wú)特殊說(shuō)明,都需要本地電腦安裝OFFICE2007和PDF閱讀器。圖紙軟件為CAD,CAXA,PROE,UG,SolidWorks等.壓縮文件請(qǐng)下載最新的WinRAR軟件解壓。
- 2. 本站的文檔不包含任何第三方提供的附件圖紙等,如果需要附件,請(qǐng)聯(lián)系上傳者。文件的所有權(quán)益歸上傳用戶所有。
- 3. 本站RAR壓縮包中若帶圖紙,網(wǎng)頁(yè)內(nèi)容里面會(huì)有圖紙預(yù)覽,若沒有圖紙預(yù)覽就沒有圖紙。
- 4. 未經(jīng)權(quán)益所有人同意不得將文件中的內(nèi)容挪作商業(yè)或盈利用途。
- 5. 眾賞文庫(kù)僅提供信息存儲(chǔ)空間,僅對(duì)用戶上傳內(nèi)容的表現(xiàn)方式做保護(hù)處理,對(duì)用戶上傳分享的文檔內(nèi)容本身不做任何修改或編輯,并不能對(duì)任何下載內(nèi)容負(fù)責(zé)。
- 6. 下載文件中如有侵權(quán)或不適當(dāng)內(nèi)容,請(qǐng)與我們聯(lián)系,我們立即糾正。
- 7. 本站不保證下載資源的準(zhǔn)確性、安全性和完整性, 同時(shí)也不承擔(dān)用戶因使用這些下載資源對(duì)自己和他人造成任何形式的傷害或損失。
最新文檔
- [雙語(yǔ)翻譯]二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難
- [雙語(yǔ)翻譯]二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難(原文).PDF
- [雙語(yǔ)翻譯]二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難.DOCX
- [雙語(yǔ)翻譯]二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難中英全
- 2016年二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難
- 2016年二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難(原文).PDF
- 2016年二手車外文翻譯—為什么買一輛高質(zhì)量的二手車這么難.DOCX
- 二手車外文翻譯
- 二手車過(guò)戶流程 二手車過(guò)戶費(fèi)用
- 二手車篇買二手車不只省車價(jià)
- 二手車鑒別
- 二手車識(shí)別
- 二手車合同
- 二手車課件
- 二手車評(píng)估-項(xiàng)目一
- 二手車寄售協(xié)議
- 二手車售車協(xié)議
- 二手車抵押合同
- 二手車寄售協(xié)議
- 二手車購(gòu)車協(xié)議
評(píng)論
0/150
提交評(píng)論