A manufacturer designs a long-term contract with a retailer who is privately informed about demand, and they face future competition by an entrant. When demand is correlated across periods, information about past sales affects firms’ behavior after entry. We analyze the incentives of the incumbent players to share this information with the entrant and show that the manufacturer and the retailer have contrasting preferences: when the retailer wants to disclose information, the manufacturer does not, and vice versa. Although transparency harms consumers and reduces total welfare, incumbent players jointly benefit from selling information to the entrant.

(2022). The value of transparency in dynamic contracting with entry [journal article - articolo]. In INTERNATIONAL JOURNAL OF INDUSTRIAL ORGANIZATION. Retrieved from http://hdl.handle.net/10446/228290

The value of transparency in dynamic contracting with entry

Piccolo, Salvatore
2022

Abstract

A manufacturer designs a long-term contract with a retailer who is privately informed about demand, and they face future competition by an entrant. When demand is correlated across periods, information about past sales affects firms’ behavior after entry. We analyze the incentives of the incumbent players to share this information with the entrant and show that the manufacturer and the retailer have contrasting preferences: when the retailer wants to disclose information, the manufacturer does not, and vice versa. Although transparency harms consumers and reduces total welfare, incumbent players jointly benefit from selling information to the entrant.
articolo
Karakoç, Gülen; Pagnozzi, Marco; Piccolo, Salvatore
(2022). The value of transparency in dynamic contracting with entry [journal article - articolo]. In INTERNATIONAL JOURNAL OF INDUSTRIAL ORGANIZATION. Retrieved from http://hdl.handle.net/10446/228290
File allegato/i alla scheda:
File Dimensione del file Formato  
1-s2.0-S0167718722000522-main.pdf

Solo gestori di archivio

Versione: publisher's version - versione editoriale
Licenza: Licenza default Aisberg
Dimensione del file 1.1 MB
Formato Adobe PDF
1.1 MB Adobe PDF   Visualizza/Apri
Pubblicazioni consigliate

Caricamento pubblicazioni consigliate

Aisberg ©2008 Servizi bibliotecari, Università degli studi di Bergamo | Terms of use/Condizioni di utilizzo

Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/10446/228290
Citazioni
  • Scopus ND
  • ???jsp.display-item.citation.isi??? ND
social impact