Detecting and Comparing the Hidden Information and the Hidden Action Problems: Decision Difficulty in Asymmetric Information Markets

Jennifer J. Lee, Binghamton University
Subimal Chatterjee, Binghamton University
We investigate decision difficulty in markets with asymmetric information where sellers hide information (a product’s true quality) or actions (how much quality they provide). We find that, although the hidden action problem is recognized to be less controllable than hidden information, it is found to be an easier decision.
[ to cite ]:
Jennifer J. Lee and Subimal Chatterjee (2014) ,"Detecting and Comparing the Hidden Information and the Hidden Action Problems: Decision Difficulty in Asymmetric Information Markets", in NA - Advances in Consumer Research Volume 42, eds. June Cotte and Stacy Wood, Duluth, MN : Association for Consumer Research, Pages: 794-794.