Topics in Microeconomics
1. Pick a topic on asymmetric information that we have covered in this course. Describe the issues, and analyze them using the knowledge you have learned in this course.
2. Anything you obtained from other sources must be provided a reference, such as a link to the webpage, newspaper, page number in a book or an article, etc.
3. Any AI software, such as ChatGPT, cannot be used to write this term paper. Violations will mean a Fail in this course and will also be reported to the Dean of the school.
The topics on asymmetric information we have covered in this course include:
(1) Auctions;
(2) Adverse selection;
(3) Signaling;
(4) Screening;
(5) Moral hazard and the principal-agent problem.
Pick one from this list.
The next page contains an example for a different class. The topic is not on asymmetric information. Just an example!
The example:
Why Recent Egg Prices Spiked in Many Countries but not Canada
Canada’s egg industry appears to be quietly sidestepping widespread shortages and wildly spiking prices affecting other countries (The Canadian Press, February 3, 2023). According to that article, “Statistics Canada said egg prices climbed 16.5 per cent year over year in December, making a dozen eggs that cost about $3.25 last year now $3.75.” ……
You can find some data for the U.S, U.K., and other countries. You then can compare the supply changes in all these countries, and also the demand changes (if any).
Use the theory of demand and supply to explain the sharp increase in egg prices. You can draw a figure if you like, but that could take up a lot of space. You can also dig up some historic data to explain why it did or did not happen in the history.
In conclusion, if you can make some policy recommendations for the Canadian government, that would be perfect.
References
The Canadian Press, February 3, 2023, “Why Canada has avoided egg shortages, major price spikes seen in U.S.” https://globalnews.ca/news/9457616/egg-prices-shortage-canada-us/
