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You are at:Home » If they know, they should tell us
Entrepreneurship

If they know, they should tell us

adminBy adminDecember 17, 2024No Comments2 Mins Read
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Asymmetrical information creates real problems. And fixing the flow of useful proxies benefits both sides.

Cigarette companies knew a great deal about the addictions they were causing and the illnesses that resulted. If the public had known, they would have made different choices.

Car companies are required to report malfunctions and injuries to the government in the US. As a result, car designs improve, safety recalls are made and lives are saved.

Should a prospective college student be told the truth about placement rates, class sizes and the training their professors have? What about campus safety and student satisfaction and well being?

The companies that sell artificial turf travel from high school to high school, seeking to sell an alternative to grass. Each school committee is underinformed and rarely has access to the data that the company has. Who benefits?

Insurance companies and hospitals know, to the penny, how much surgical procedures cost. And they also know which doctors have the best (and worst) outcomes. How does keeping this a secret help the patient?

In issues of public health, how loudly do we hear anecdotal stories compared to how clearly are we presented with verifiable and relevant statistics? Is an intervention actually risky or does it just feel that way?

In the short run, economics appear to push businesses to keep information secret and to fight against community action. But history makes it clear that a well-regulated industry serving well-informed consumers actually creates more value (and generates more profit.)

The FDA was expanded in 1938 because eye and skin cream easily available at the drugstore was causing women to go blind. Armed with better information and more confidence from consumers, that industry is now 10,000 times bigger than it was.

It’s tempting to lurk in the shadows, conceal the truth and race to the bottom.

The race to the top requires a foundation of trust, and trust comes from relevant information. Sunlight makes it easier to see where we’re going.

December 17, 2024





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