Welfare implications of information sharing by integrated e-retailers
Arundhati Sarkar Bose and
Sumit Sarkar
Applied Economics Letters, 2025, vol. 32, issue 8, 1144-1150
Abstract:
An integrated e-retailer competes with third-party sellers on the retailer’s platform. Due to its access to consumer data and its analytic capability, the integrated retailer possesses demand information that is not available to third-party sellers. When the information is not shared by the retailer, the third-party sellers make an imprecise estimate. Modelling the competition as a Cournot game, we show that by withholding information the retailer benefits at the cost of the third-party sellers only if the actual demand is more than that estimated by the third-party sellers and is less than a threshold. However, consumers’ surplus increases. The gain in consumers’ surplus may be greater than the retailer’s profit gain, resulting in an increase in social welfare. Increases in the commission rate, the number of third-party sellers, and the wholesale price of the product encourage the retailer to share demand information with the third-party sellers. The insights help integrated retailers decide their information sharing strategy, and the regulators in formulating antitrust laws.
Date: 2025
References: Add references at CitEc
Citations:
Downloads: (external link)
http://hdl.handle.net/10.1080/13504851.2024.2302868 (text/html)
Access to full text is restricted to subscribers.
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:taf:apeclt:v:32:y:2025:i:8:p:1144-1150
Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEL20
DOI: 10.1080/13504851.2024.2302868
Access Statistics for this article
Applied Economics Letters is currently edited by Anita Phillips
More articles in Applied Economics Letters from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().