▁in ▁ne o - class ical ▁econom ics . ▁In ▁ 2 0 0 1 ▁the ▁Nobel ▁Memorial ▁Prize ▁in ▁Econom ics ▁was ▁awarded ▁ ▁to ▁George ▁A ker lo f , ▁Michael ▁Sp ence , ▁and ▁Joseph ▁E . ▁St ig l itz ▁for ▁their ▁" anal ys es ▁of ▁mark ets ▁with ▁asym metric ▁information ". ▁ ▁Mod els ▁Information ▁asym met ry ▁models ▁assume ▁that ▁at ▁least ▁one ▁party ▁to ▁a ▁transaction ▁has ▁relevant ▁information , ▁whereas ▁the ▁other ( s ) ▁do ▁not . ▁Some ▁asym metric ▁information ▁models ▁can ▁also ▁be ▁used ▁in ▁situations ▁where ▁at ▁least ▁one ▁party ▁can ▁en force , ▁or ▁effectively ▁ret ali ate ▁for ▁bre aches ▁of , ▁certain ▁parts ▁of ▁an ▁agreement , ▁whereas ▁the ▁other ( s ) ▁cannot . ▁ ▁In ▁ad verse ▁selection ▁models , ▁the ▁ignor ant ▁party ▁la cks ▁information ▁while ▁negoti ating ▁an ▁agreed ▁understanding ▁of ▁or ▁contract ▁to ▁the ▁transaction , ▁whereas ▁in ▁moral ▁ha z ard ▁the ▁ignor ant ▁party ▁la cks ▁information ▁about ▁performance ▁of ▁the ▁agreed - up on ▁transaction ▁or ▁la cks ▁the ▁ability ▁to ▁ret ali ate ▁for ▁a ▁bre ach ▁of ▁the ▁agreement . ▁ ▁An ▁example ▁of ▁ad verse ▁selection ▁is ▁when ▁people ▁who ▁are ▁high - ris k ▁are ▁more ▁likely ▁to ▁buy ▁ins urance ▁because ▁the ▁ins urance ▁company ▁cannot ▁effectively ▁disc rim inate ▁against ▁them , ▁usually ▁due ▁to ▁lack ▁of ▁information ▁about ▁the ▁particular ▁individual ' s ▁risk ▁but ▁also ▁sometimes ▁by ▁force ▁of