Information asymmetry happens when buyers and sellers have different levels of information, leading to adverse selection in the market. Adverse selection occurs when one party, either the buyer or the seller, has hidden information about the product and makes buying or selling decisions based on that information. For example, in the used car market, buyers cannot know everything about the cars and cannot fully trust them. Because of this, they often try to buy used cars at lower prices to evaluate their quality. To make buyers feel more confident, sellers might promise to repair the car free of charge if it breaks within a year after purchase, protecting themselves against adverse selection. A successful transaction depends on strategies that align with the market’s specific characteristics. - Joseph’s “just my thoughts”
There is a saying that bears perform tricks and their owners have money. Ownership, and thus rights, are powerful when they become a platform. The odds of making vast sums of money from video creators are small. However, most of them need video editing, regardless of their profits. In fact, rather than making money for video creators, video editing software companies make money. There are far more ads in job openings asking for editors than for video creators. The more online shopping malls there are, the more money delivery companies make. Since business is a competition within finite conditions, the primary virtue of business is to be in the best position above all else. It must be hard to get into the wrong line and compensate for it with something else. - Joseph’s “just my thoughts”