27 septembre 2022
Ce document est lié à :
info:eu-repo/semantics/altIdentifier/doi/10.1007/s42973-022-00119-w
Takeshi Murooka et al., « Adverse selection and bounded rationality: an impossibility theorem », HAL-SHS : économie et finance, ID : 10.1007/s42973-022-00119-w
We consider an adverse selection environment between an informed seller and an uninformed buyer, where no trade occurs when all buyers are the standard Bayesian-rational type. The buyer may be a “behavioral” type in that he may take actions different from the rational type. We show that, for any incentive-feasible mechanism with any non-trivial trade, the buyer’s ex-ante expected payoff is strictly negative. Our result implies that whenever trade occurs, some behavioral types must incur losses—highlighting a new trade-off between social surplus and buyer protection.