March 19, 2018

Coarse Grades

Crude measures of quality are sometimes better for consumers.

Third party certifications can be an important tool for consumers, and in theory, the more information certifiers provide about a product's quality the better. But researchers Rick Harbaugh and Eric Rasmusen say that crude measures of quality can be more beneficial for the public. This video summarizes their paper published in the February issue of American Economic Journal: Microeconomics.