VIENNA JOINT ECONOMICS SEMINAR	INVITATION
R E M I N D E R The University of Vienna and the Institute for Advanced Studies cordially invite you to the following Vienna Joint Economics Seminar Thursday, May 18, 2017 University of Vienna, Oskar-Morgenstern-Platz 1, 1090 Vienna, VGSE seminar room, 3rd floor 1:15 pm Heski Bar-Isaac University of Toronto Adverse selection, efficiency and the structure of information, with application to labour markets We explore how the structure of public and private information impact on efficiency and adverse selection in Akerlof’s (1970) Lemons model, extended to admit a matching component. Adverse selection is defined quantitatively as the difference in expected value of those who trade compared to the population at large, conditional on public information. In our employer learning context, this is also the amount by which wages are depressed by asymmetric information. For a fixed information structure, efficiency and adverse selection are co-monotone. Both depend on the realisation of information only through its effect on the public expectation of the worker’s match with the current employer, with adverse selection increasing and efficiency decreasing in this variable. Instead, comparing different information structures can allow expected adverse selection and efficiency both to increase. More generally, we parameterize Gaussian information structures and characterise the extent of adverse selection and efficiency that they can achieve. Under natural conditions, average wages are higher for the workers who leave than are retained when adverse selection is imposed (approximately) efficiently. (joint work with Ian Jewitt and Clare Leaver) We are looking forward to seeing you! Institute for Advanced Studies Josefstädter Straße 39, 1080 Vienna, Austria Tel.: +43 1 599 91 232 e-Mail: economics@ihs.ac.at http://www.ihs.ac.at		LINKS DIRECTIONS TO UNIVERSITY OF VIENNA on Google maps VIENNA JOINT ECONOMICS SEMINAR on Google calendar ECONOMICS SEMINARS IN VIENNA on Google calendar
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