Information sharing when competing manufacturers adopt asymmetric channel in an e-tailer

Abstract

<p style='text-indent:20px;'>This paper investigates the incentive for information sharing when competing manufacturers sell substitute products through the marketplace channel and the reseller channel respectively. Our analysis shows that the e-tailer's incentive to share information strongly depends on the platform fee, competition intensity, and different information sharing scenarios. If competition intensity is small, or competition intensity is large and the platform fee is enough large, the e-tailer has incentive to alone share information with the manufacturer who is from the marketplace channel; if competition intensity is moderate and the platform fee is small, or competition intensity is large but the platform fee is moderate, it has incentive to share information with both manufacturers; if competition intensity is large but the platform fee is small, it has no incentive to share information. The results also indicate that the double marginalization effect of information sharing is a promoting factor to share information under linear cost, which is different from previous literature. Additionally, we find that the main qualitative insights from the base model are robust even if one monopolist manufacturer employs both channels. And we also compare the incentive of information sharing under asymmetric channel with that under symmetric channel.</p>