Asymmetric Information

If you cannot tell the difference between a high-quality product and a cleverly disguised piece of junk, what are you willing to pay? Nobel laureate George Akerlof famously answered this with his "e;Market for Lemons"e; theory. When sellers hold more information about a product's true quality than buyers, the market naturally drives out good products, leaving only the "e;lemons"e; behind. This e...