Bouvard, Matthieu; Levy, Raphael - Collegio Carlo Alberto, Università degli Studi di Torino - 2013
In a market where sellers solicit certication to overcome adverse selection, we show that the profit of a monopolistic certifier is hump-shaped in his reputation for accuracy: a higher accuracy attracts high-quality sellers but sometimes repels low-quality sellers. As a consequence, reputational...