asymmetric information Chapter uri icon

abstract

  • The product of momentous advances in economic theory, the concept of asymmetric information is of great relevance to strategic management. The effects of asymmetric information primarily involve unobserved characteristics or actions that result in ADVERSE SELECTION and MORAL HAZARD. SIGNALING and screening may remedy adverse selection, and optimal contract design may remedy moral hazard. Notable uses include quality disclosure, firm capitalization, limit pricing and advertising.

author list (cited authors)

  • Brown, A. L.

editor list (cited editors)

  • Augier, M., & Teece, D. J.

Book Title

  • The Palgrave Encyclopedia of Strategic Management

publication date

  • January 1, 2015 11:11 AM