Template-Type: ReDIF-Article 1.0

Author-Name: László Csorba
Author-Workplace-Name: Eszterházy Károly University
Author-Email: csorba.laszlo@uni-eszterhazy.hu

Title: Issues and Types of Adverse Selection and Negative Selection

Abstract: In a relatively high number of cases, there are selection criteria in everyday life,
the implementation of which clearly does not support the development of the
economy, even in the short term. At the same time, the phenomenon of adverse
selection raises its head relatively rarely in reality, since it is equally dependent on
the preconditions of a high degree of hidden information and the complete good
faith of the stakeholders. In comparison, negative selection is – by necessity – a more
frequent case. In such cases, the relevant information is available to the parties.
At the same time, the individual or group possessing the information consciously
abuses their dominant position. Moreover, this specifically disadvantages those
who currently best comply with the existing selection requirements, but in spite
of this are vulnerable due to the lack of a proper negotiating position or interestasserting
capability. However, the dominant position or power possessed by the
relevant party can also be used “according to its intended purpose”, which enables
the implementation of positive selection that is very likely to promote development.

Classification-JEL: D81, D82, D92, E32, L15
Keywords: economic evolution, economic selection, adverse selection, negative selection, market structure, stakeholder theories
Pages: 87-116
Volume: 18
Issue: 2
Year: 2019
File-URL: http://english.hitelintezetiszemle.hu/letoltes/fer-18-2-st4-csorba.pdf
File-Format: Application/pdf
Handle: RePEc:mnb:finrev:v:18:y:2019:i:2:p:87-116