Crane. Discussion Question Week 7 - Crane Discussion Question Week 7 The company Ive chosen is the US Government and discussion focuses on a moral

Crane. Discussion Question Week 7 - Crane Discussion...

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Crane, Discussion Question Week 7 The company I’ve chosen is the US Government and discussion focuses on a moral hazard created by the Consumer Product Safety Commission and the recently enforced Consumer Products Safety Improvement Act which mandates all products targeted to children must contain safe levels of lead and plastic softeners - phthalates (who can be against that right)? Well, some of the unintended consequences are having a major impact on manufacturers, retailers, and most of all could affect parents’ sense of caution when it comes to buying toys for their children. With this regulatory insinuation the Government creates asymmetric information where parents are lulled away from natural hesitations to provide a safe environment for children, and businesses without economic or legislative recourse, are now the less informed parties. Further, there are numerous examples of wealth creating transactions not consummated as a result of this asymmetric information.

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