SSE/EFI Working Paper Series in Economics and Finance
Price Signals Quality. The Case of One-Sided Asymmetric Information
Abstract: The paper considers the pricing decision by a seller who
has private information about quality. It is shown that, contrary to
widespread belief, high quality products may be sold with positive
probability even when buyers have no private information. The separating
equilibria have a very simple structure.
Keywords: Pricing; signalling; product quality; separating equilibrium; (follow links to similar papers)
JEL-Codes: L15; D82; (follow links to similar papers)
14 pages, July 1995
- This paper is published as:
Ellingsen, Tore, (1997), 'Price Signals Quality. The Case of One-Sided Asymmetric Information', International Journal of Industrial Organization, Vol. 16, pages 43-61
Questions (including download problems) about the papers in this series should be directed to Helena Lundin ()
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Design by Joachim Ekebom