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The Sale of Data: Learning Synergies Before M&As

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  • Dubus, Antoine
  • Legros, Patrick

Abstract

Firms may share information to discover potential synergies between their data sets and algorithms, which eventually may lead to more efficient mergers and acquisitions (M&A) decisions. However, as pointed out by Arrow, information sharing also modiï¬ es the competitive balance when companies do not merge, and a ï¬ rm may be reluctant to share information with potential rivals. Under general conditions, we show that ï¬ rms beneï¬ t from (partially) sharing information. Because more sharing of information may increase industry expected proï¬ ts both when there is head-to-head competition and when there is an M&A, the presence of a regulator who can prevent or allow the M&A can decrease or increase the level of information sharing, as well as consumer surplus, with respect to the no-regulator case. A regulator who can also control the level of information sharing will allow ï¬ rms to share information.

Suggested Citation

  • Dubus, Antoine & Legros, Patrick, 2022. "The Sale of Data: Learning Synergies Before M&As," CEPR Discussion Papers 17404, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:17404
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    Cited by:

    1. is not listed on IDEAS
    2. Tzvetomir Tzanov, 2024. "Super Apps and Synergies Generation – Strategic and Financial Management Implications," Innovative Information Technologies for Economy Digitalization (IITED), University of National and World Economy, Sofia, Bulgaria, issue 1, pages 51-60, October.
    3. Hemant Bhargava & Antoine Dubus & David Ronayne & Shiva Shekhar, 2024. "The Strategic Value of Data Sharing in Interdependent Markets," CESifo Working Paper Series 10963, CESifo.
    4. Georgios Petropoulos & Bertin Martens & Geoffrey Parker & Marshall Van Alstyne, 2023. "Platform Competition and Information Sharing," CESifo Working Paper Series 10663, CESifo.

    More about this item

    Keywords

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    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • L5 - Industrial Organization - - Regulation and Industrial Policy

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