Information revelation and certification intermediaries

Alessandro Lizzeri

    Research output: Contribution to journalArticle

    Abstract

    I discuss the role of intermediaries that search out the information of privately informed parties and then choose what to reveal to uninformed parties. My focus is on the strategic manipulation of information by these certification intermediaries. I show that in a class of environments the optimal choice for a monopoly intermediary is to reveal only whether quality is above some minimal standard. Despite this minimal information transmission, the intermediary can capture a large share of the surplus. I also show that competition among intermediaries can lead to full information revelation.

    Original languageEnglish (US)
    Pages (from-to)214-231
    Number of pages18
    JournalRAND Journal of Economics
    Volume30
    Issue number2
    DOIs
    StatePublished - Jan 1 1999

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    ASJC Scopus subject areas

    • Economics and Econometrics

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