The New Debate
Edited by Tyler Cowen and Eric Crampton
Recent years have seen the development of new theories of market failure based on asymmetric information and network effects. According to the new paradigm, we can expect substantial failure in the markets for labor, credit, insurance, software, new technologies and even used cars, to give but a few examples. This volume brings together the key papers on the subject, including classic papers by Joseph Stiglitz, George Akerlof and Paul David. The book provides powerful theoretical and empirical rebuttals challenging the assumptions of these new models and questioning the usual policy conclusions. It goes on to demonstrate how an examination of real markets and careful experimental studies are unable to verify the new theories. New frontiers for research are also suggested.
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- Market Failure or Success The New Debate
- Front Matter
- Chapter 1: Introduction
- PART 1 New Market Failure Theories
- Chapter 2: Toward a general theory of wage and price rigidities and economic fluctuations
- Chapter 3: Keynesian economics and critique of first fundamental theorem of welfare economics
- Chapter 4: The market for 'lemons': quality uncertainty and the market mechanism
- Chapter 5: Path dependence, its critics and the quest for 'historical economics'
- PART 2 Theoretical Responses
- Chapter 6: Information and efficiency: another viewpoint
- Chapter 7: Efficiency wage models of unemployment: one view
- Chapter 8: Do informational frictions justify federal credit programs?
- Chapter 9: The demand for and supply of assurance
- PART 3 Empirical and Experimental Responses
- Chapter 10: Beta, Macintosh and other fabulous tales
- Chapter 11: Some evidence on the empirical significance of credit rationing
- Chapter 12: An empirical examination of information barriers to trade in insurance
- Chapter 13: A direct test of the 'lemons' model: the market for used pickup trucks
- Chapter 14: Public choice experiments
- Chapter 15: Non-prisoner's dilemma
- Chapter 16: Group size and the voluntary provision of public goods: experimental evidence utilizing large groups
- Chapter 17: Cooperation in public-goods experiments: kindness or confusion?
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