Kuvalekar, Aditya and Ramos, João and Schneider, Johannes (2023) The Wrong Kind of Information. RAND Journal of Economics, 54 (2). pp. 360-384. DOI https://doi.org/10.1111/1756-2171.12440
Kuvalekar, Aditya and Ramos, João and Schneider, Johannes (2023) The Wrong Kind of Information. RAND Journal of Economics, 54 (2). pp. 360-384. DOI https://doi.org/10.1111/1756-2171.12440
Kuvalekar, Aditya and Ramos, João and Schneider, Johannes (2023) The Wrong Kind of Information. RAND Journal of Economics, 54 (2). pp. 360-384. DOI https://doi.org/10.1111/1756-2171.12440
Abstract
Agents, some with a bias, decide between undertaking a risky project and a safe alternative based on information about the project's efficiency. Only a part of that information is verifiable. Unbiased agents want to undertake only efficient projects, while biased agents want to undertake any project. If the project causes harm, a court examines the verifiable information, forms a belief about the agent's type, and decides the punishment. Tension arises between deterring inefficient projects and a chilling effect on using the unverifiable information. Improving the unverifiable information always increases overall efficiency, but improving the verifiable information may reduce efficiency.
Item Type: | Article |
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Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Economics, Department of |
SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
Depositing User: | Unnamed user with email elements@essex.ac.uk |
Date Deposited: | 07 Feb 2023 17:40 |
Last Modified: | 16 May 2024 21:29 |
URI: | http://repository.essex.ac.uk/id/eprint/33670 |
Available files
Filename: The RAND J of Economics - 2023 - Kuvalekar - The wrong kind of information.pdf
Licence: Creative Commons: Attribution 4.0