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Published on Wednesday, February 5, 2020 | Updated on Friday, February 7, 2020

Modeling the economics of information-sharing

Information is any kind of data-based inference. Conditional to context, information-sharing within markets can either improve or reduce welfare, and it can either foster or subdue competition. These effects will depend on both the nature of the competition and the type of uncertainty that such information addresses.

Key points

  • Key points:
  • In dynamic environments, information-sharing can facilitate collusion. For that reason, antitrust policy is wary of such initiatives.
  • Digital platforms challenge the conventional wisdom regarding the damaging effects of information-sharing, especially in a setting of competition “for” the market.
  • Together with competition analysis, privacy and data security costs need to be weighed when dealing with personal data-sharing.
  • Artificial intelligence poses new challenges for competition policy.

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