Economic Bulletin of the National Mining University

 

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Article

Issue:2019 №3 (67)
Section:Economic theory
UDK:339.137
DOI:https://doi.org/10.33271/ev/67.025
Article language:Ukrainian
Pages:25-32
Title:Impact of information asymmetry on competition
Authors:Gerasymenko A. H., Kyiv National University of Trade and Economics,
Nesterets A. A., Kyiv National University of Trade and Economics
Annotation:Information occupies one of the most important places in the system of economic relations, therefore it can be asserted with confidence that this is the most valuable of resources. A prerequisite for healthy competition is the greatest possible information transparency of markets and the economy as a whole, and the influence of information asymmetry on the competitive mechanism of market self-regulation requires scientific research and justification. The article investigates the influence of information asymmetry on competition. The directions and tools of the influence of information asymmetry on competition in the markets of goods and services are revealed in the context of the vertical and horizontal channels of the spread of information asymmetry in society. The mechanism of the influence of information asymmetry on competition in the vertical channel (the concealment and distortion of information that is aimed at consumers and suppliers) is explained on the basis of Akerlof lemons model. The ability of information manipulation about the quality of goods, the completeness of information about the services provided, etc. is illustrated under initial information asymmetry to ensure the displacement of individual participants from the market and thereby weakening existing and potential competition. Examples from the practice of the Antimonopoly Committee of Ukraine are given. To explain the mechanism of the influence of information asymmetry of potential competition in the horizontal channel of the spread of information asymmetry, that is, misleading a competitor to prevent him from entering the market, the model of R. Selten was used. Its practical application and consequences for competition are studied on the example of the Ukrainian air transportation market. The analysis concerned the largest airline in Ukraine (UIA) and the Irish company Ryanair. According to the results of the study, the predominantly anticompetitive effect of information asymmetry on competition has been revealed. It provides conscientious business entities with unfavorable competition conditions, forcing them to either exit the market or resort to dishonest methods of competition to counter the effects of the spread of information asymmetry in the context of the formation and development of the information economy. The asymmetry of information has a serious negative effect, expressed in a decrease in the effectiveness of decisions made by market participants, the functioning of the market itself and the economy as a whole, which prevents the country from taking its respectable place in the global economic system. 
Keywords:Information asymmetry, Horizontal and vertical channels of information asymmetry distribution, Competition, Lemons market model, R. Selten model, Anticompetitive actions
File of the article:EV20193_025-032.pdf
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