Reselling Information

S. Nageeb Ali, Ayal Chen-Zion and Erik Lillethun ()

Papers from arXiv.org

Abstract: Information is replicable in that it can be simultaneously consumed and sold to others. We study how resale affects a decentralized market for information. We show that even if the initial seller is an informational monopolist, she captures non-trivial rents from at most a single buyer: her payoffs converge to 0 as soon as a single buyer has bought information. By contrast, if the seller can also sell valueless tokens, there exists a ``prepay equilibrium'' where payment is extracted from all buyers before the information good is released. By exploiting resale possibilities, this prepay equilibrium gives the seller as high a payoff as she would achieve if resale were prohibited.

Date: 2020-04, Revised 2022-12
New Economics Papers: this item is included in nep-com, nep-des, nep-gth, nep-mic and nep-pay
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