B
Bruce_Savage
Guest
Do you reckon it's possible to use Asymmetric Signalling for Horse Racing?
A little theory from my notes to get you a brief understanding off what it's about
If Information is verifiable & transferable it has a habit of coming out.
Two firms; Firm B & Firm A
Firm B doesn’t know about Firm A’s cost and produce at CM.
Firm A knows about Firm B’s costs and can produce at CM, CL or CH
By Firm A revealing it’s low costs then it’s going to force Firm B to cut back on production which is a positive for Firm A, whilst if Firm A reveals its high costs then this is going to hurt them.
If Firm A was to reveal their medium cost because they wouldn’t want to be confused for high costs firms, this would expose Firms with higher costs that would have no option but to be revealed them.
Moral of the story that we tend to look for evidence that is there when we should look for evidence that isn’t there, silence speaks volumes. The lack of a signal can be informative.
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If we were to transfer high, low and medium costs into high, low and medium quality horses then possibly this process could be worked through.
Information raveling - could the top yards send out low class horses (HL)
in order to force the hand of the better class horses (HC) to shine through whereby they are unable to sneak through the handicaps for example;
Say you've got a small Trainer like Venittia Williams who probably has a horse with about 15lbs in hand, she would be happy to see this horse run within 5-6l off a Paul Nicholls 4-6 favourite. Would Paul Nicholls send out a low class horse in order to force the hand of others? we all know his horses are over priced & doesn't represent any value.
Looking for information that isn't there? would this Paul Nicholls horse who is running over 2M4F today had a run over 3M last time out would count as informational evidence for getting the trip. Then, you have the Venitta Williams horse who is untried at the trip and stepping up from 2M1F?
A little theory from my notes to get you a brief understanding off what it's about
If Information is verifiable & transferable it has a habit of coming out.
Two firms; Firm B & Firm A
Firm B doesn’t know about Firm A’s cost and produce at CM.
Firm A knows about Firm B’s costs and can produce at CM, CL or CH
By Firm A revealing it’s low costs then it’s going to force Firm B to cut back on production which is a positive for Firm A, whilst if Firm A reveals its high costs then this is going to hurt them.
If Firm A was to reveal their medium cost because they wouldn’t want to be confused for high costs firms, this would expose Firms with higher costs that would have no option but to be revealed them.
Moral of the story that we tend to look for evidence that is there when we should look for evidence that isn’t there, silence speaks volumes. The lack of a signal can be informative.
/
If we were to transfer high, low and medium costs into high, low and medium quality horses then possibly this process could be worked through.
Information raveling - could the top yards send out low class horses (HL)
in order to force the hand of the better class horses (HC) to shine through whereby they are unable to sneak through the handicaps for example;
Say you've got a small Trainer like Venittia Williams who probably has a horse with about 15lbs in hand, she would be happy to see this horse run within 5-6l off a Paul Nicholls 4-6 favourite. Would Paul Nicholls send out a low class horse in order to force the hand of others? we all know his horses are over priced & doesn't represent any value.
Looking for information that isn't there? would this Paul Nicholls horse who is running over 2M4F today had a run over 3M last time out would count as informational evidence for getting the trip. Then, you have the Venitta Williams horse who is untried at the trip and stepping up from 2M1F?