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Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/28507
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| Title: | Customer Information Sharing: Strategic Incentives and New Implications |
| Authors: | Kim, Byungcheol - Michigan State University
Choi, Jay Pil - Michigan State University |
| Keywords: | Customer Information Sharing, Complements and Substitutes, Product
Differentiation, Behavior-Based Price Discrimination, Merger and
Acquisition, Middlemen |
| Issue Date: | 2007 |
| Series/Report no.: | NET Institute Working Paper;07-27 |
| Abstract: | We study oligopolistic firms' incentives to share customer information
about past purchase history in a situation where firms are uncertain
about whether a particular consumer considers the product offerings
complements or substitutes. By addressing this new type of
behavior-based price discrimination, we show that both the incentive to
share customer information and its effects on consumers depend crucially
on the relative magnitudes of the prices that would prevail in the
complementary and substitute markets if consumers were fully segmented
according to their preferences. This paper has important implications
for merger analysis when the primary motive for merger is the
acquisition of another firm's customer lists. We also find that the
informational regime in which firms reside can have an influence upon
the choice of product differentiation. Additionally, our analysis
suggests a new role of middlemen as information aggregators. |
| URI: | http://hdl.handle.net/2451/28507 |
| Appears in Collections: | NET Institute Working Papers Series
NET Institute Working Papers Series
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