IDEAS home Printed from https://ideas.repec.org/a/eee/jetheo/v216y2024ics0022053123001758.html
   My bibliography  Save this article

Selling information in competitive environments

Author

Listed:
  • Bonatti, Alessandro
  • Dahleh, Munther
  • Horel, Thibaut
  • Nouripour, Amir

Abstract

Data buyers compete in a game of incomplete information about which a single data seller owns some payoff-relevant information. The seller faces a joint information- and mechanism-design problem: deciding which information to sell, while eliciting the buyers' types and imposing payments. We derive the welfare- and revenue-optimal mechanisms for a class of games with binary actions and states. Our results highlight the critical properties of selling information in competitive environments: (i) the negative externalities arising from buyer competition increase the profitability of recommending the correct action to one buyer exclusively; (ii) for the buyers to follow the seller's recommendations, the degree of exclusivity must be limited; (iii) the buyers' obedience constraints also reduce the distortions in the allocation of information introduced by a monopolist; (iv) as competition becomes fiercer, these limitations become more severe, weakening the impact of market power on the optimal allocation of information.

Suggested Citation

  • Bonatti, Alessandro & Dahleh, Munther & Horel, Thibaut & Nouripour, Amir, 2024. "Selling information in competitive environments," Journal of Economic Theory, Elsevier, vol. 216(C).
    • Handle: RePEc:eee:jetheo:v:216:y:2024:i:c:s0022053123001758
    DOI: 10.1016/j.jet.2023.105779
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0022053123001758
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jet.2023.105779?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Data; Competition; Screening; Information design; Externalities;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jetheo:v:216:y:2024:i:c:s0022053123001758. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622869 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.