Alternatives and Supplements: Fun on the Internet
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Information, Risk & Exclusion

Why Business Organizations?

Economist have actually asked questions such as, "Why are there business organizations and not just individuals buying and selling in markets?" Ronald Coase helped provide a good answer, as explained by Michael Munger:

Screening and Signaling

What happens when one side of the market has better information about product quality than the other? Three economists who answered that question received a Nobel Prize in 2001:

Mazda destroys 4703 new cars, worth about $100 million, to protect its brand name:

Risk and Uncertainty

Here is an explanation of arbitrage, one of the several topics discussed in this section:


Insurance markets are strange markets, and give rise to a phenomenon called moral hazard. This entry in The Concise Encyclopedia of Economics explains a bit about this market and the problems in it:

Quality and Price

(I have not yet found an appropriate entry for this topic.)

Nasty Auctions

Some kinds of auctions should be avoided. This blog entry has a lengthy quotation from economist Robert Frank on the entrapment game:


These links were checked on July 5, 2008.

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