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Data brokers co-opetition

Author

Listed:
  • Yiquan Gu
  • Leonardo Madio
  • Carlo Reggiani

Abstract

Data brokers collect, manage, and sell customer data. We propose a simple model, in which data brokers sell data to downstream firms. We characterise the optimal strategy of data brokers and highlight the role played by the data structure for co-opetition. If data are “sub-additive”, with the combined value lower than the sum of the values of the two datasets, data brokers share data and sell them jointly. When data are “additive” or “supra- additive”, with the combined value equal to or greater than the sum of the two datasets, data brokers compete. Results are robust to several extensions.

Suggested Citation

  • Yiquan Gu & Leonardo Madio & Carlo Reggiani, 2019. "Data brokers co-opetition," CESifo Working Paper Series 7523, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_7523
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    File URL: https://www.cesifo-group.de/DocDL/cesifo1_wp7523.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    data brokers; personal information; privacy; co-opetition;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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