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The Market for Lemons: Adverse Selection Unraveling (2D)

Interactive 2D model of Akerlof's Market for Lemons: watch a used-goods market unravel on a quality axis as buyers, unable to see individual quality, price on the average — driving high-quality sellers out round after round.

Economics & Social Systems2DModerate60 FPS📱 Mobile-adapted⇄ 3D version

George Akerlof's classic model of information asymmetry, rendered as a live 2D market chart. A population of sellers, each holding a good of a different true quality, faces buyers who can only estimate quality from the pool average — not observe it directly. Tune how severe that information asymmetry is, how much buyers value quality versus how sellers value their own cost, and watch the market either stay efficient or unravel round by round as high-quality sellers priced below their reservation cost exit, dragging the average — and the price — down behind them.

⚙ Under the hood

2D quality-axis chart of Akerlof's Market for Lemons: buyers price sellers on the pool average instead of true quality, and high-quality sellers exit round after round as the market unravels toward lemons-only.

adverse selectioninformation asymmetrymarket designgame theorymicroeconomicsakerlofmarket failure

2D · HTML5 Canvas 2D · 60 FPS target · runs fully client-side, no install