Policymaking in the EU requires member states to delegate negotiations to individual ministers. For coalition governments, this creates information asymmetries because parties holding the relevant ministerial portfolio gain privileged access while their coalition partners are sidelined. This paper argues that bicameralism in the EU mitigates this problem: sidelined parties can shadow their coalition partners through the committees of the European Parliament. Committees allow parties to monitor legislative processes and negotiations in the Council, which is particularly attractive for sidelined parties. Analyzing original data on committee and rapporteur assignments between 2004 and 2024, I find that MEPs systematically shadow their coalition partners in policy areas where their national party lacks direct representation in the Council and is misaligned with its coalition partners.

Risks and disputes are prevalent in the illegal online erotic fiction market due to the absence of state protection and enforcement, the lack of accepted criteria for evaluating product quality, the customisation of services, and widespread plagiarism. Drawing on insights from the sociological literature on signalling theory and Varese’s production–trade–governance framework, this article empirically investigates the strategies developed by author-sellers in this market to signal their trustworthiness to customers and resolve disputes. Agents and author-sellers send multiple signals to persuade potential buyers of their trustworthiness and ability, including by sharing writing samples created for previous clients, sharing their collective writing projects, disclosing past transaction records, and being selective about which orders to accept. Agents and author-sellers also offer multiple options for dispute resolution during the sales process, leverage information asymmetry to resolve disputes caused by delivery delays, and utilise neutralisation techniques to address disputes stemming from plagiarism. This research expands the literature on signalling theory, and its findings will hopefully inspire future studies of other illegal online markets.

The 2025 Budget exemplified the dysfunction in the UK’s Budget process, with systematic and selective briefing of underlying forecast details—meant to be private between the Office for Budget Responsibility and the Treasury—to the media since the 2022 ‘mini-budget’ crisis. In all documented occasions, this has come from the Treasury, with the OBR remaining silent allowing the Treasury to bed in a narrative based on partial information, with real costs in terms of prolonged uncertainty and market volatility. This article proposes a relatively narrow reform to the process that would see the OBR ‘bookend’ the Budget. The OBR would publish its pre-measures forecast three weeks before a fiscal statement—the same timing as it currently delivers it internally to the Treasury. The Treasury would then respond with its policy measures on Budget Day, with an OBR assessment following some days or a couple of weeks later. Key benefits of this reform are: increased transparency and democratic accountability; removing the OBR from politically contentious judgements about second-round effects of policies before they are announced and under pressure from the Treasury to hit particular fiscal rule targets; reducing the window for market uncertainty by providing a published baseline; and restricting speculation after OBR publication to policy decisions. This would be achieved while minimising the impact on the established forecast timetable. This design, adopting established practice from the Netherlands in publishing the pre-measures forecast to the UK’s institutional setup, can help guard the OBR’s independence while reducing the window for market volatility.

We analyze the equilibrium conditions in which contracts are desirable for firms (buyers) with various levels of management efficiencies procuring a factor input under two levels of quality from supplies. The quality of the factor input, which affects production efficiency, may be known to the buyer; the efficiency of the firm is not known to the supplier. We estimate, using principal-agent models, that firms with high-management efficiency do not have the incentive to pay a quality premium to suppliers, but firms operating with low management efficiency are willing to offer a price premium for quality. The model is applied to the question of preconditioning cattle for the feedlot.

Experimental work using real married couples has shown that efficiency in intra-household allocations is influenced by information asymmetry between spouses. We conduct a lab-in-the-field experiment in rural India to test the extent to which lack of complete information on spousal preferences related to a bundle of private goods can affect allocation dynamics as well as expectations about allocations. We first show that there exist information asymmetries in spousal preferences, and that our information intervention helps reduce gendered misperception in beliefs about allocations and actual allocations, especially for men. However, information on spousal preferences does not significantly affect the final allocation decision, suggesting that husbands and wives may be responding to existing gender norms. We outline implications for experimental work on intra-household bargaining, and for policy.

Existing research on lobbying has predominantly focused on its material returns, such as equity returns, stock prices, and government contracts while overlooking its informational impact. This paper addresses this gap by investigating to what extent and under what conditions policymakers assimilate information delivered through corporate lobbying. Drawing on an informational perspective, it proposes that the informational effect of lobbying is moderated by the information asymmetry between policymakers and firms. Focusing on the U.S. ride-hailing industry, this study utilizes a unique dataset on U.S. state legislatures’ adoption of the model policy lobbied by ride-hailing companies. The results reveal that the informational impact of corporate lobbying is highly contingent upon the presence of information asymmetry between policymakers and firms, which can be attributed to policymakers’ resources for independent information gathering, information deliberation through public hearings or media discussions, and countervailing lobbying efforts.

This paper uses data from the 2021 Swiss edition of the Gault&Millau food guide to analyze the probability with which restaurant owners decide to share their wine list with the public. This is an important question relating to the amount of information circulating in markets characterized by information asymmetry in the context of experience and credence goods. We find that restaurant owners are more willing to share wine lists with others if competition is limited or their wine list does not contain idiosyncratic information that competitors may use strategically. Interviews indicate the challenge for restaurants to balance the risk of sharing information with competitors and the opportunity to attract wine lovers by revealing an appealing wine list. We also show that this decision depends on cultural considerations.

The economic literature on negotiation shows that strategic concerns can be a barrier to agreement, even when the buyer values the good more than the seller. Yet behavioral research demonstrates that human interaction can overcome these strategic concerns through communication. We show that there is also a downside of this human interaction: cynicism. Across two studies we focus on a seller-buyer interaction in which the buyer has uncertain knowledge about the goods for sale, but has a positive expected payoff from saying “yes” to the available transaction. Study 1 shows that most buyers accept offers made by computers, but that acceptance rates drop significantly when offers are made by human sellers who communicate directly with buyers. Study 2 clarifies that this effect results from allowing human sellers to communicate with buyers, and shows that such communication focuses the buyers’ attention on the seller’s trustworthiness. The mere situation of negotiated interaction increases buyers’ attention to the sellers’ self-serving motives and, consequently, buyers’ cynicism. Unaware of this downside of interaction, sellers actually prefer to have the opportunity to communicate with buyers.

The literature on behavioral decision-making and negotiations to date usually advocates first-mover advantage in distributive negotiations, and bases this preference on the anchoring heuristic. In the following paper, we suggest that the preference for moving first vs. moving second in negotiations may not be as clear-cut as presumed, especially in situations characterized by information asymmetry between negotiating counterparts. In Study 1, we examined people’s initiation preferences and found that unless taught otherwise, people intuitively often prefer to move second. In Studies 2–4, we experimentally tested the suggested advantage of moving second, and demonstrated that in information-asymmetry scenarios – when one party has perfect background information and the other has none — it is actually preferable for both counterparts not to give the first offer while negotiating. We discuss the implications of our findings on the field of negotiation and decision-making, and lay the groundwork for future studies examining this issue.

In this paper we investigate the claim that decisions from experience (in which the features of lotteries are learned through a sampling process) differ from decisions from description (in which features of lotteries are explicitly described). We find that the experience-description gap is not as robust as has been previously assumed. We argue that when this gap appears it is driven to a large extent by asymmetries in information concerning which events are possible and which are certain. First, we find that, when experience-based decision makers sample events without error and then are told what outcomes are associated with each possible event, they are risk seeking for low-probability gains and risk averse for high-probability gains, as in description-based decision making. Second, we find that the experience-description gap for low-probability outcomes appears when rare outcomes are never experienced but disappears when: 1) all distinct outcomes are experienced at least once or 2) never-experienced outcomes are described as possibilities. Third, we find that the experience-description gap for high-probability outcomes is pronounced when decision makers previously experience lotteries that both offered the possibility of a zero outcome (which presumably makes them doubt that an always-experienced outcome is certain), but disappears when they have not previously experienced such lotteries.

This article sheds light on cybersecurity risk disclosure practices, offering explanations based on the corporate governance literature. We argue that cybersecurity risk management poses particular challenges for corporations due to amplified agency problems. Cybersecurity risks are increasing in number and growing in complexity for companies worldwide. The financial sector in the Benelux region was already digitalising rapidly when, in 2020, enhanced remote-working requirements due to the COVID-19 pandemic further contributed to risk exposure. Substantiating our theoretical discussion, we present and discuss insights as to the most pressing cybersecurity risk management issues in the financial sector based on evidence from semi-structured interviews with Chief Information Security Officers/Chief Security Officers from financial sector leads in the Benelux region. We discuss contemporary factors that might induce management to dedicate more attention to cybersecurity. This apparent shift in companies’ approaches regarding cybersecurity is likely to encounter obstacles and should not be expected to be an even and linear process, given the challenges of processing and communicating information in an environment featuring high uncertainty and technical complexity as well as potentially misaligned incentives.