<Li> An incentive exists for the seller to pass off a low - quality product as a higher - quality one </Li> <Li> Sellers have no credible disclosure technology (sellers with a great car have no way to disclose this credibly to buyers) </Li> <Li> Either a continuum of seller qualities exists or the average seller type is sufficiently low (buyers are sufficiently pessimistic about the seller's quality) </Li> <Li> Deficiency of effective public quality assurances (by reputation or regulation and / or of effective guarantees / warranties) </Li>

The market for 'lemons' quality uncertainty and the market mechanism