| Abstract: | This article examines the market response to new risk information implicit in a recent regulatory stop-sale of new three-wheeled all-terrain vehicles. A hedonic price analysis is used to quantify the stop-sale's impact in the secondhand market, a market segment not directly affected by the stop-sale. The analysis shows a substantial reduction in the price of three-wheeled all-terrain vehicles relative to the price of less risky models. This result is consistent with rational economic behavior and suggests that providing new risk information can improve market effciency. |
