Reading a book called "The Undercover Economist" (which I highly recommend), I've come across something called "the problem of adverse selection". Not having a background in economics, I'm curious about how much this problem applies to web development. Can anyone help?
Here's the classic example of the problem: In the used car market, buyers struggle to distinguish good cars ("peaches") from bad cars ("lemons"). Sellers have a good idea whether their car is a peach or a lemon. It's therefore rational for a potential buyer to offer whatever an average car is worth (as they can't tell whether this particular car is a peach of a lemon), but only rational for owners of lemons to sell at that price. Because of this, only lemons are ever sold. To the extent that that's understood by buyers, offers will fall further and the quality of the cars sold will follow. The end result: only the worst cars are traded; no one ever buys a peach.
Of course, that's all theory. In the real world, buyers do have some ability to distinguish peaches from lemons (whether by the reputation of the seller or their own knowledge of cars), so it is possible to buy a decent car (even if it's difficult). Still, the difference in knowledge between buyer and seller does damage the market to some extent.
Does this also apply to web development? Can we say: In the web development market, buyers struggle to distinguish a well-coded site from a poorly coded site. Developers have a good idea of the quality of their work. It's therefore rational for a potential client to offer whatever a half-decent job is worth (as they won't be able to tell whether their site has been well-coded or poorly coded), but only rational for someone to do a half-decent (or worse) job for that price. Because of this, only sub-standard web development is ever sold. To the extent that that's understood by clients, offers will fall further and the quality of work sold will follow. The end result: only the worst web development work is ever sold; no one ever buys a peach of a website.
I know that it is possible, in the real world, to buy good web development (just as it's possible to buy a good used car). I'm just curious whether the difference in knowledge between client and web developer is something that damages the web development market in the same way as the difference in knowledge between buyers and sellers of used cars is something that damages the used car market. Or is there some difference between web development and used cars that means that the problem of adverse selection doesn't apply?