Gewährleistungsregeln als Instrument der Informationsübertragung

The article analyses the German legal norms of warranty (money-back-warranties, price reductions, damages, and replacement warranties) in a model of a competitive market according to their ability to induce the disclosure of product information. Two types of consumers demand goods: One type is only interested in high quality products, the other would also buy low quality products. The analysis arrives at two basic conclusions: a) Even in the case of identical suppliers with an unchangeable given quota of low quality products there is a need for warranties, b) The legal warranties are in principle suited to stimulate the necessary disclosure