Working Paper No. 268

Equilibrium in Search Models with Adverse Selection

Published: November, 1990Pages: 17Keywords: Nonexistence, Equilibrium Search, Adverse SelectionJEL-codes: 020, 820

Equilibrium in Search Models with Adverse Selection James W. Albrecht and Susan B. Vroman.


This paper examines the problem of nonexistence of equilibrium in a simple search model with asymmetric information. A pure-strategy, symmetric Nash equilibrium fails to exist because adverse selection arising from steady-state considerations causes a nonconcavity in the payoff function.

Interdisciplinary European Studies

The European Union in a Changing World Order

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This book explores how the European Union responds to the ongoing challenges to the liberal international order. These challenges arise both within the EU itself and beyond its borders, and put into question the values of free trade and liberal democracy. 

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