The strategic peril of information sharing in a vertical-Nash supply chain: A note

Abstract

Conventional wisdom suggests that information sharing benefits at least one of the participants. However, we find that information sharing can be strategically detrimental to both members in a vertical-Nash supply chain. Comparative statics show that each supply chain member's beneficial areas are smaller when its information source becomes more variable and larger as its signal is less accurate. Furthermore, the Pareto-inferior areas in which both supply chain members get worse are non-monotonic in exogenous parameters