ECON 307 Economics of Information
This course focuses on the economic implications of asymmetric information which exists when one party in a relationship is better informed than another. For example the seller of a used car has better information about the car's quality than the buyer; the owner of a firm cannot perfectly monitor the effort levels of employees. Asymmetric information represents an important deviation from the perfectly competitive model and can give rise to inefficient outcomes. Applications that will be covered include corporate governance labor markets auctions and public decision making. Concepts will be covered in a mathematically rigorous way.