Temporal, social, and meaningful aspects of information sharing behavior

Previous studies on resource-sharing behavior have revealed a number of factors which influence the decision-making process. For example, Allison and Messick (1990) found payoffs, resource divisibility, fate control, and social values to be significant factors influencing resource-sharing decisions. Information sharing behavior, however, remains relatively unexamined. The present study was designed to investigate the effects of three situational cues on information sharing behavior, including the type of information at hand (ambiguous or concrete), the amount of time allotted to complete a task, and the availability of a team of experts. Results indicated a two-way interaction between the type of information and target (partner or competitor), F(1, 76) = 39.28, p \u3c .001, demonstrating a tendency for individuals to share concrete information with their partners and ambiguous information with their competitors regardless of the given time frame or availability of a team of experts. These findings contradict those of Allison and Eylon (1996), which showed that participants preferred to share ambiguous information with their partners and concrete information with their competitors. Possible explanations for these findings and suggestions for future research involving information sharing behavior are discussed

Overcoming Impediments to Information Sharing

When deciding whether to share information, firms consider their private welfare. Discrepancies between social and private welfare may lead firms excessively to share information to anti-competitive ends - in facilitating of cartels and other harmful horizontal practices - a problem both antitrust scholarship and case law have paid much attention to. On the other hand, legal scholars have paid far less attention to the opposite type of inefficiency in information sharing among competitors - namely, the problem of sub-optimal information sharing. This phenomenon can generate significant social costs and is of special importance in network industries because the maintenance of compatibility, a key to producing positive network effects, typically requires information sharing. Understanding the hitherto neglected impact of sub-optimal information sharing is important not only for many areas of antitrust law, but also for developing effective policies towards network industries and critical infrastructures more generally, as well as for improving those procedural rules that concern information exchange among litigating parties. This paper therefore advances the legal analysis of impediments to efficient information sharing in a number of significant ways: First, it shows that the strategic behavior of competitors may erect an economic barrier to information sharing that has not been previously addressed in the literature - the fear of degradation. This form of strategic behavior involves the strategic refusal to share information when the refusal inflicts a greater harm on one\u27s rivals than on oneself, and thus generates a competitive advantage. Second, the paper reveals a hitherto unrecognized set of behavioral impediments to information sharing, wherein rivalry norms and managers\u27 risk attitudes bias competitors\u27 judgments of the prospects of information sharing and the status-quo bias and ambiguity aversion lead these decision makers to avoid such arrangements. Third, it integrates these economic and behavioral insights with the findings of the extant literature to create a new framework for predicting when private information sharing will be suboptimal. Finally, we suggest how the alignment of private information sharing with social optimality may be promoted, based on the framework developed here

Overcoming Impediments to Information Sharing

When deciding whether to share information, firms consider their private welfare. Discrepancies between social and private welfare may lead firms excessively to share information to anti-competitive ends - in facilitating of cartels and other harmful horizontal practices - a problem both antitrust scholarship and case law have paid much attention to. On the other hand, legal scholars have paid far less attention to the opposite type of inefficiency in information sharing among competitors - namely, the problem of sub-optimal information sharing. This phenomenon can generate significant social costs and is of special importance in network industries because the maintenance of compatibility, a key to producing positive network effects, typically requires information sharing. Understanding the hitherto neglected impact of sub-optimal information sharing is important not only for many areas of antitrust law, but also for developing effective policies towards network industries and critical infrastructures more generally, as well as for improving those procedural rules that concern information exchange among litigating parties. This paper therefore advances the legal analysis of impediments to efficient information sharing in a number of significant ways: First, it shows that the strategic behavior of competitors may erect an economic barrier to information sharing that has not been previously addressed in the literature - the fear of degradation. This form of strategic behavior involves the strategic refusal to share information when the refusal inflicts a greater harm on one\u27s rivals than on oneself, and thus generates a competitive advantage. Second, the paper reveals a hitherto unrecognized set of behavioral impediments to information sharing, wherein rivalry norms and managers\u27 risk attitudes bias competitors\u27 judgments of the prospects of information sharing and the status-quo bias and ambiguity aversion lead these decision makers to avoid such arrangements. Third, it integrates these economic and behavioral insights with the findings of the extant literature to create a new framework for predicting when private information sharing will be suboptimal. Finally, we suggest how the alignment of private information sharing with social optimality may be promoted, based on the framework developed here

The Economic Ramifications of Strategic IT Security Information Sharing in the Financial Services Industry

We investigate the economic ramifications of strategic IT security information sharing among firms in the financial services industry. An IT security information sharing system can potentially minimize security breaches. However, although the Presidential Decision Directive/NSC-63 encouraged the establishment of such a system in the form of industry based information sharing and analysis centers (ISACs), it is injudicious to assume that firms will be willing to naively share their security information with their strategic competitors. We argue that without a proper mechanism some firms will try to put in minimum effort, potentially reducing the system’s reliability, and aim to answer the following research question: “What will it take for a financial services firm to willingly share its strategic information technology security information with its competitors through an ISAC?” We use the theory of mechanism design in economics to develop an adverse selection model to address the question

The Invisible Risk: The Data-sharing Activities of Data Brokers and Information Leakage

Data brokers are the major players in the market for collecting, selling and sharing user information. This paper considers data brokers’ data sharing activities as a co-opetition between data brokers and investigates how the information collecting and sharing activities may lead to information leakage on the dark web. We find that S&P 1,500 firms experience higher information leakage when sharing more customer information with data brokers through third-party cookies. Further, using all the registered data brokers and their competitors as the sample, we observe that registered data brokers are more susceptible to information leakage with data sharing activities than unregistered data brokers. Our study provides initial evidence on the consequences of data brokers’ data sharing activities

Joint Customer Data Acquisition and Sharing among Rivals

It is increasingly observable that in different industries competitors jointly acquire and share customer data. We propose a modified Hotelling model with two-dimensional consumer heterogeneity to analyze the incentives for such agreements and their welfare implications. In our model the incentives of firms for data acquisition and sharing depend on the willingness of consumers to switch brands. Firms jointly collect data on transportation cost parameters when consumers are relatively immobile between brands. However, the firms are unlikely to cooperatively acquire such data, when consumers are relatively mobile. Incentives to share information depend on the portfolio of data firms hold and consumer mobility. Data sharing arises with relatively mobile and immobile consumers - it is neutral for consumers in the former case, but reduces consumer surplus in the latter. Competition authorities ought to scrutinize such cooperation agreements on a case-by-case basis and devote special attention to consumer switching behavior.Information Sharing, Data Acquisition, Price Discrimination

Harnessing and Sharing the Benefits of State Sponsored Research

In recent years data-sharing has been a recurring focus of struggle within the scientific research community as improvements in information technology and digital networks have expanded the ways that data can be produced, disseminated, and used. Information technology makes it easier to share data in publicly accessible archives that aggregate data from multiple sources. Such sharing and aggregation facilitate observations that would otherwise be impossible. But data disclosure poses a dilemma for scientists. Data have long been the stock in trade of working scientists, lending credibility to their claims while highlighting new questions that are worthy of future research funding. Some disclosure is necessary in order to claim these benefits, but data disclosure may also benefit one\u27s research competitors. Scientists who share their data promptly and freely may find themselves at a competitive disadvantage relative to free riders in the race to make future observations and thereby to earn further recognition and funding. The possibility of commercial gain further raises the competitive stakes. This article discusses data sharing in California\u27s stem cell initiative against the background of other data sharing efforts and in light of the competing interests that the California Institute for Regenerative Medicine (CIRM) is directed to balance. We begin by considering how IP law affects data-sharing. We then assess the strategic considerations that guide the IP and data policies and strategies of federal, state, and private research sponsors. With this background, we discuss four specific sets of issues that public sponsors of data-rich research, including CIRM, are likely to confront: (1) how to motivate researchers to contribute data; (2) who may have access to the data and on what conditions; (3) what data get deposited and when do they get deposited; and (4) how to establish database architecture and curate and maintain the database

Endogenous spillovers, increased competition and re-organization waves

We consider an entrepreneur that is the sole producer of a cost reducing skill, but the entrepreneur that hires a team to use the skill cannot prevent collusive trade for the innovation related knowledge between employees and competitors. We show that there are two types of diffusion avoiding strategies for the entrepreneur to preempt collusive communication i) setting up a large productive capacity (the traditional firm) and ii) keeping a small team (the lean firm). The traditional firm is characterized by its many "marginal" employees that work short days, receive flat wages and are incompletely informed about the innovation. The lean firm is small in number of employees, engages in complete information sharing among members, that are paid with stock option schemes. We find that the lean firm is superior to the traditional firm when technological entry costs are low and when the sector is immature.Information sharing, endogenous spillovers, physical assets, corporate transformation, stock-options, collussion, trade secrets

A framework for thinking about enterprise formalization policies in developing countries

What policies encourage firms to become formal? The standard approach emphasizes reducing the costs of compliance with government regulation. This is unlikely to be sufficient. Instead we need to understand compliance as a function not only of firm-level costs and benefits but also in terms of the interaction between the firm and its competitors and between the firm and the state. This paper emphasizes the coordination and credibility issues involved in promoting formalization and discusses possible institutional solutions, among them business associations that make the benefits of membership dependent on compliance, information sharing arrangements among government agencies and improvements in the quality of public management.Microfinance,Small Scale Enterprise,Public Sector Economics&Finance,Economic Theory&Research,Public Sector Regulation