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Frontiers of Microeconomics — Asymmetric Information, Political Economy, and Behavioral Economics Explained | Chapter 22 of Principles of Microeconomics What happens when economic agents have imperfect information or when psychological biases affect decisions? Chapter 22 of Principles of Microeconomics explores three advanced fields— asymmetric information , political economy , and behavioral economics —that deepen traditional economic models by incorporating real-world complexities. 🎥 Watch the full chapter summary below and subscribe to Last Minute Lecture for more textbook breakdowns and academic study guides! Asymmetric Information and Market Failures Markets can fail when one party has more or better information than another. Key problems include: Moral Hazard: Hidden actions that change behavior after a deal, like workers slacking off when unmonitored. Adverse Selection: Hidden characteristics cause bad products or risky buyers to dominate, lik...

Oligopoly, Game Theory, and Antitrust Policy — Collusion, Cartels, and Strategic Behavior Explained | Chapter 17 of Principles of Microeconomics What happens when a few powerful firms dominate an industry? Chapter 17 of Principles of Microeconomics explores oligopoly , a market structure defined by strategic interaction between a handful of competitors. This chapter summary unpacks the tension between cooperation and competition, explains how game theory models firm behavior, and examines the role of antitrust laws in regulating collusion and promoting fair markets. 🎥 Watch the full chapter summary below and subscribe to Last Minute Lecture for more textbook breakdowns and academic study guides! Oligopoly: Strategic Markets and Interdependence An oligopoly exists when a few large firms control most of the market. Unlike perfectly competitive markets, firms in oligopoly are highly interdependent—their pricing and output decisions directly affect competitors. ...