Coordination and information sharing about pest resistance

We develop a dynamic oligopolistic Cournot model of a pesticide market where resistance to pesticides can develop. We first study firms' incentives for resistance management through pricing and we distinguish two cases of demand for pesticides; one where users are able to coordinate their pesticide use and one where they are not. We show that users benefit from coordination, but that this gain is at the expense of firms facing a lower demand. When firms are allowed to obtain scientific information on the likelihood of pest resistance and, possibly, to share this information among themselves, we find that they have an incentive to acquire information and to share it with competitors. They also benefit from transmitting this information to users if the latter are coordinated. In the case of uncoordinated users, transmission of information to users is not necessarily profitable for firms if it favors their coordination. Finally, we discuss the policy implications for existing information sharing committees in the pesticide industry.