Voluntary disclosure of private information and unraveling in the market for lemons: an experiment
type: Item
instance of: scholarly article
title: Voluntary disclosure of private information and unraveling in the market for lemons: an experiment
zbMATH Open document ID: 1405.91295
author: Volker Benndorf
published in: Games
publication date: 2018-07-10T00:00:00Z
review text: Summary: We experimentally analyze a lemons market with a labor-market framing. Sellers are referred to as ``workers'' and have the possibility to provide ``employers'' with costly but credible information about their ``productivity''. Economic theory suggests that in this setup, unraveling takes place and a number of different types are correctly identified in equilibrium. While we do observe a substantial degree of information disclosure, we also find that unraveling is typically not as complete as predicted by economic theory. The behavior of both workers and employers impedes unraveling in that there is too little disclosure. Workers are generally reluctant to disclose their private information, and employers enforce this behavior by bidding less competitively if workers reveal compared to the case where they conceal information.
Mathematics Subject Classification ID: 91B40
Mathematics Subject Classification ID: 91A90
Mathematics Subject Classification ID: 91B26
zbMATH DE Number: 6901033
zbMATH Keywords: asymmetric information
zbMATH Keywords: information disclosure
zbMATH Keywords: unraveling
zbMATH Keywords: privacy
zbMATH Keywords: lemons market
describes a project that uses: Z-Tree
describes a project that uses: ORSEE
MaRDI profile type: Publication
full work available at URL: g9020023
OpenAlex ID: W2800001976
cites work: Naïveté-Based Discrimination*
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cites work: Meet the lemons: an experiment on how cheap-talk overcomes adverse selection in decentralized markets
cites work: Q4902563
DOI: 10.3390/G9020023
description: scientific article; zbMATH DE number 6901033