Information Asymmetries and Paying it Forward

The Internet and the scale of transparency it has brought to human civilization has changed everything.

Near-free information flow between all humans on earth has brought light to the corners of the earth where human-on-human atrocities have been performed for millenia.

Light being shown on evil acts is a pre-requisite to justice being served.

One of my favorite quotes is from a Civil War-era abolitionist:

Look at the facts of the world. You see a continual and progressive triumph of the right. I do not pretend to understand the moral universe, the arc is a long one, my eye reaches but little ways. I cannot calculate the curve and complete the figure by the experience of sight; I can divine it by conscience. But from what I see I am sure it bends towards justice.

Things refuse to be mismanaged long. Jefferson trembled when he thought of slavery and remembered that God is just. Ere long all America will tremble.

Theodore Parker

I agree–and there are empirical signs that Theodore Parker is right.

However there is another type of injustice that becomes more pervasive and harder to eliminate than physical violence.

This is a type of injustice caused by the existince of “information asymmetries.”

An information asymmetry is where two parties to a transaction do not have the same factual information on hand.

A great example is purchasing a car:

The salesperson preys on the buyer’s ignorance and obtains an immmoral advantage in negotiation:

Asymmetric Information

I believe that eliminating this type of information asymmetry will become the next piece of the “arc” towards justice.

Education in its various forms has helped me out of more predatory situations than I can count.

For this reason I try to share information that I’ve learned (and solicit it from others) to pay it forward.

You don’t have to be a formal K-12 school teacher, but please, pay it forward!

· economics, capitalism