Seminars and Events
ECON3016 - Economics of Information
One often encounters situations in which two agents are
involved in a mutual agreement. Invariably, one economic agent has more
information about a characteristic that is relevant to the agreement,
than the other. In this module, we will study how agents deal with this
information asymmetry by designing incentives and embedding them in
contracts. We will also study the effects of information asymmetry on
the prevailing market equilibrium. Applications of the theory include
insurance, labour economics, industrial economics, and environmental
By the end of the module, students should:
- Be familiar with the different types of information asymmetries and their consequences in contract design and market equilibrium
- Solve principal-agent models using appropriate mathematical techniques
- Be familiar with empirical tests of information asymmetries
The course comprises 20 hours of lectures and 4 compulsory tutorial classes with accompanying exercises. There will be a 2-hour unseen written examination in Term 3.
Affiliate students leaving in December will take a 2-hour written examination set up by the Department at the end of Term 1.
3rd year Economics (L100), Phil/Econ (VL51), Math/Econ (G1L1/G1LC) and Econ/Stats (LG13) students.
|Prerequisites:||ECON2001: Microeconomics, and ECON2007: Quantitative Economics and Econometrics.|
|Maximum module enrolments:||82|
|Module Evaluation (Previous year):||