We examine a vertically integrated platform's incentives to share demand information with a ‘third-party’ seller. When consumers perceive the platform's private label and the seller's products as relatively close substitutes, and quality strongly affects demand, the platform tends not to share information with the seller. We find that consumers are often better off without information sharing even in the absence of explicit privacy concerns, since information sharing facilitates rent extraction via targeted prices. The region of parameters where this occurs expands as the platform's bargain power vis-à-vis the seller increases.

(2021). Should vertically integrated platforms be mandated to share information with their rivals? [journal article - articolo]. In ECONOMICS LETTERS. Retrieved from http://hdl.handle.net/10446/228194

Should vertically integrated platforms be mandated to share information with their rivals?

Piccolo, Salvatore;
2021-01-01

Abstract

We examine a vertically integrated platform's incentives to share demand information with a ‘third-party’ seller. When consumers perceive the platform's private label and the seller's products as relatively close substitutes, and quality strongly affects demand, the platform tends not to share information with the seller. We find that consumers are often better off without information sharing even in the absence of explicit privacy concerns, since information sharing facilitates rent extraction via targeted prices. The region of parameters where this occurs expands as the platform's bargain power vis-à-vis the seller increases.
articolo
Padilla, Jorge; Piccolo, Salvatore; Vasconcelos, Helder
(2021). Should vertically integrated platforms be mandated to share information with their rivals? [journal article - articolo]. In ECONOMICS LETTERS. Retrieved from http://hdl.handle.net/10446/228194
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10446/228194
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