Meet the Lemons: How Cheap Talk Overcomes Adverse Selection in a Decentralized Market Experiment

2015 ◽  
Author(s):  
Simon Siegenthaler
Keyword(s):  
Adverse Selection ◽  
Cheap Talk ◽  
Market Experiment ◽  
Decentralized Market

Cheap Talk, Fraud, and Adverse Selection in Financial Markets: Some Experimental Evidence

1999 ◽  
Vol 12 (3) ◽  
pp. 481-518 ◽  
Author(s):  
Robert Forsythe ◽  
Russell Lundholm ◽  
Thomas Rietz
Keyword(s):  
Financial Markets ◽  
Experimental Evidence ◽  
Adverse Selection ◽  
Cheap Talk

Adverse selection and reputation in a world of cheap talk

2010 ◽  
Vol 50 (4) ◽  
pp. 548-558 ◽  
Author(s):  
Craig A. Depken ◽  
Ying Zhang
Keyword(s):  
Adverse Selection ◽  
Cheap Talk

scholarly journals Competing mechanisms in markets for lemons

2019 ◽  
Vol 14 (3) ◽  
pp. 927-970 ◽  
Author(s):  
Sarah Auster ◽  
Piero Gottardi
Keyword(s):  
Adverse Selection ◽  
Traditional Approach ◽  
Directed Search ◽  
High Type ◽  
Trading Mechanisms ◽  
Decentralized Market

We study directed search equilibria in a decentralized market with adverse selection, where uninformed buyers post general trading mechanisms and informed sellers select one of them. We show that this has differing and significant implications with respect to the traditional approach, based on bilateral contracting between the parties. In equilibrium, all buyers post the same mechanism and low‐quality sellers receive priority in any meeting with a buyer. Also, buyers make strictly higher profits with low‐ than with high‐type sellers. When adverse selection is severe, the equilibrium features rationing and is constrained inefficient. Compared to the equilibrium with bilateral contracting, the equilibrium with general mechanisms yields a higher surplus for most, but not all, parameter specifications.

AGENCY PROBLEM DALAM PENERAPAN PEMBIAYAAN AKAD MUDHARABAH PADA PERBANKAN SYARIAH

ALQALAM ◽  
2016 ◽  
Vol 33 (1) ◽  
pp. 46
Author(s):  
Aswadi Lubis
Keyword(s):  
High Risk ◽  
Asymmetric Information ◽  
Human Resources ◽  
Moral Hazard ◽  
Adverse Selection ◽  
Agency Problem ◽  
Agency Problems ◽  
Islamic Banking ◽  
The Public

The purpose of writing this article is to describe the agency problems that arise in the application of the financing with mudharabah on Islamic banking. In this article the author describes the use of the theory of financing, asymetri information, agency problems inside of financing. The conclusion of this article is that the financing is asymmetric information problems will arise, both adverse selection and moral hazard. The high risk of prospective managers (mudharib) for their moral hazard and lack of readiness of human resources in Islamic banking is among the factors that make the composition of the distribution of funds to the public more in the form of financing. The limitations that can be done to optimize this financing is among other things; owners of capital supervision (monitoring) and the customers themselves place restrictions on its actions (bonding).

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