Third-party certification is a typical solution to the information asymmetry of buyersand sellers regarding product quality. According to Milgrom (1981) and Grossman (1981), if a third-party certifier provides certification services free of charge, firms of every quality level have an incentive to disclose their true product quality because consumers will interpret non-disclosure as the lowest quality.When disclosure cost is positive, disclosure equilibrium can be categorized by a quality cutoff such that all qualities above the cutoff disclose and all qualities below the cutoff do not disclose (Jovanovic 1982). These theories generate two predictions in our context: