Asymmetric Information



Asymmetric Information

Introduction

In contract and economic theory, asymmetry information deals with the study of decisions in transactions. Asymmetry information is a term used in economic to describe how one person involved in a transaction has better or more information than other person (Izquierdo, 2007). Information asymmetry defines that an agent has information that another not. Asymmetrical information can place a person at disadvantage. One of the main problem of information asymmetry arises in credit card market, employment decisions, and insurance markets where a person applying for insurance, credit card, or job knows much better bout his/her abilities, risk, or health ...