Reselling Information
Computer Science and Game Theory
2022-12-06 v2 Theoretical Economics
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.
Keywords
Cite
@article{arxiv.2004.01788,
title = {Reselling Information},
author = {S. Nageeb Ali and Ayal Chen-Zion and Erik Lillethun},
journal= {arXiv preprint arXiv:2004.01788},
year = {2022}
}