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Data Collection by an Informed Seller

Author

Listed:
  • Ichihashi, Shota
  • Smolin, Alex

Abstract

A seller faces a consumer with an uncertain value for the product. The seller has imperfect private information about the value and requests additional data to set the price. The consumer can decline any request. The consumer's willingness to provide data depends on his belief about the seller's type which in turn depends on the request. We show that the type uncertainty limits the scope of data collection: All equilibrium payoffs are spanned by fully pooling equilibria in which the seller collects the same data regardless of the type. The seller's private information lowers efficiency and profits, but benefits the consumer by fueling his skepticism and preventing excessive data collection. Having less private information may enable the seller to collect more data directly from the consumer and may lower the overall consumer welfare.

Suggested Citation

  • Ichihashi, Shota & Smolin, Alex, 2022. "Data Collection by an Informed Seller," CEPR Discussion Papers 17239, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:17239
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    Cited by:

    1. is not listed on IDEAS
    2. Andrew Rhodes & Jidong Zhou, 2024. "Personalized Pricing and Competition," American Economic Review, American Economic Association, vol. 114(7), pages 2141-2170, July.
    3. Aköz, Kemal Kıvanç & Samsonov, Arseniy, 2025. "Information agreements," Journal of Economic Theory, Elsevier, vol. 229(C).
    4. Roland Strausz, 2024. "Correlation‐savvy sellers," RAND Journal of Economics, RAND Corporation, vol. 55(2), pages 266-291, June.
    5. Junjie Chen & Takuro Yamashita, 2025. "The Design of Monopoly Information Broker," Papers 2503.19539, arXiv.org.
    6. Sarit Markovich & Yaron Yehezkel, 2024. "“For the public benefit”: Data policy in platform markets," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 33(3), pages 652-685, August.

    More about this item

    Keywords

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    JEL classification:

    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • 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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