A seller can benefit from information about the valuation a potential buyer places on the good. Under some circumstances, improved information raises social welfare. But under other circumstances, the information has private value but no social value, so that agents may spend too much on collecting information. A government which collects and disseminates some information about valuations can limit spending by private agents on data collection, thereby increasing social welfare. That is, governmental provision of information may be useful not because information is socially useful, but because it limits the amount private agents spend on collecting information.
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Paper provided by University of California-Irvine, Department of Economics in its series Working Papers with number
080908.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Camille Cornand & Frank Heinemann, 2006.
"Optimal Degree of Public Information Dissemination,"
Discussion Papers
158, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
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