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Selling Information

Author

Listed:
  • Johannes Horner
  • Andrzej Skrzypacz

Abstract

An Agent who owns information that is potentially valuable to a Firm bargains for its sale, without commitment and certification possibilities, short of disclosing it. We propose a model of gradual persuasion and show how gradualism helps mitigate the hold-up problem (that the Firm would not pay once it learns the information). An example illustrates how it is optimal to give away part of the information at the beginning of the bargaining, and sell the remainder in dribs and drabs. The Agent can only appropriate part of the value of information. Introducing a third-party allows her to extract the maximum surplus.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Johannes Horner & Andrzej Skrzypacz, 2013. "Selling Information," Levine's Working Paper Archive 786969000000000680, David K. Levine.
    • Handle: RePEc:cla:levarc:786969000000000680
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    File URL: http://www.dklevine.com/archive/refs4786969000000000680.pdf
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    References listed on IDEAS

    as
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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • 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

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