Welcome to: Information Economics -- a book by Urs Birchler and Monika Bütler.

Market Signals as Powerful Purveyors of Information

In Friedrich Durrenmatt´s play "The Visit of the Old Lady", Claire Zachanassian, old and immensely rich, returns to her home town of Güllen and shocks citizens of this sleazy place with an unsavory offer. She publicly promises a bounty of one billion to be divided among the town´s treasury and its citizens under the condition that Alfred Ill dies. Alfred was her early love, but he let her down when she became pregnant, and Claire finally left Güllen. Now, after surviving eight rich husbands, the old lady exacts her revenge.
What happens after the offer? Of course, officials reject the offer in disgust, as do the citizens. They also try to calm Alfred. Yet, to his mortification, his fellow citizens soon start to appear with new shoes. Other purchases follow, more and more of them on credit. Poor Alfred can tell from observed market transactions that he has no chance. Eventually Alfred meets his deadly fate.
The story illustrates the power of the market to aggregate pieces of individual information and making it public. This function of the market as a huge information processor is discussed in Chapter 7 of Information Economics.