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INFORMATION ASSYMETRY .pptx

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Ganesh Poudel

Information asymmetry occurs when one party in an economic transaction has more or better information than the other party. This can lead to market failures like the lemon problem. In healthcare, information asymmetry exists between providers and patients, contributing to medical errors, overtreatment, and undertreatment. It is seen as problems of moral hazard and adverse selection. Possible interventions include better information disclosure and independent reviews to address information asymmetries.

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INFORMATION ASYMMETRY GANESH POUDEL BPH 6TH SEM NAMS COLLEGE
SURPRISE IS THE MOTHER OF PANIC -NICK MURRAY
When there is an imbalance in the quantity of a product demanded and supplied, it leads to an inefficient allocation of resources called market failure. MARKET FAILURE
Information asymmetry is, just as the term suggests, unequal, disproportionate, or lopsided information. INFORMATION ASYMMETRY
INFORMATION FAILURE/ IA Condition in which one party to an economic transaction possesses greater material knowledge than the other party is IA. One party in transaction does not know enough about other party to make accurate decision due to: Under-allocation of resources. Better information too costly.
LEMON PROBLEM (GEORGE AKERLOF-NOBEL PRICE WINNER) Lemon problem arises when it is not possible to distinguish reliable products from lemon(defective product). Buyer are only willing to pay at lemon price. Sellers of reliable products exit from market. Only lemon products remain in market.
INFORMATION ASSYMETRY .pptx
IN HEALTH
Ctd.. Asymmetric information exchange between providers and patients contributes to medical errors, patients frustration, over- treatment and under-treatment in healthcare practice.
Ctd Doctors and other caregivers overwhelm patients with information and deliver treatments that often are unnecessary; Doctors and other caregivers do not engage patients sufficiently and fail to provide necessary care; and Uninformed patients demand unnecessary treatments (often based on anecdotal experience, social media conversations or faulty research).
PROBLEM SEEN AS MORAL HAZARD Moral hazard is the risk that a party has not entered into a contract in good faith or has provided misleading information about its assets, liabilities, or credit capacity.
Ctd.. ADVERSE SELECTION Adverse selection is when sellers have information that buyers do not have, or vice versa, about some aspect of product quality.
DISADVANTAGES
INTERVENTION
THANK YOU

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INFORMATION ASSYMETRY .pptx

  • 2. SURPRISE IS THE MOTHER OF PANIC -NICK MURRAY
  • 3. When there is an imbalance in the quantity of a product demanded and supplied, it leads to an inefficient allocation of resources called market failure. MARKET FAILURE
  • 4. Information asymmetry is, just as the term suggests, unequal, disproportionate, or lopsided information. INFORMATION ASYMMETRY
  • 5. INFORMATION FAILURE/ IA Condition in which one party to an economic transaction possesses greater material knowledge than the other party is IA. One party in transaction does not know enough about other party to make accurate decision due to: Under-allocation of resources. Better information too costly.
  • 6. LEMON PROBLEM (GEORGE AKERLOF-NOBEL PRICE WINNER) Lemon problem arises when it is not possible to distinguish reliable products from lemon(defective product). Buyer are only willing to pay at lemon price. Sellers of reliable products exit from market. Only lemon products remain in market.
  • 9. Ctd.. Asymmetric information exchange between providers and patients contributes to medical errors, patients frustration, over- treatment and under-treatment in healthcare practice.
  • 10. Ctd Doctors and other caregivers overwhelm patients with information and deliver treatments that often are unnecessary; Doctors and other caregivers do not engage patients sufficiently and fail to provide necessary care; and Uninformed patients demand unnecessary treatments (often based on anecdotal experience, social media conversations or faulty research).
  • 11. PROBLEM SEEN AS MORAL HAZARD Moral hazard is the risk that a party has not entered into a contract in good faith or has provided misleading information about its assets, liabilities, or credit capacity.
  • 12. Ctd.. ADVERSE SELECTION Adverse selection is when sellers have information that buyers do not have, or vice versa, about some aspect of product quality.