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Information Acquisition and Strategic Disclosure in Oligopoly

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  • Jos Jansen

Abstract

I study the incentives of oligopolists to acquire and disclose information on a common demand intercept. Because firms may fail to acquire information even when they invest in information acquisition, firms can credibly conceal unfavorable news while disclosing favorable news. Firms may earn higher expected profits under such a selective disclosure regime than under the regimes where firms commit to share all or no information. In particular, this holds under both Cournot and Bertrand competition, if the firms have sufficiently flat information acquisition cost functions. For steeper cost functions Cournot duopolists prefer strategic disclosure, if their goods are sufficiently differentiated.

Suggested Citation

  • Jos Jansen, 2008. "Information Acquisition and Strategic Disclosure in Oligopoly," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 17(1), pages 113-148, March.
    • Handle: RePEc:bla:jemstr:v:17:y:2008:i:1:p:113-148
    DOI: 10.1111/j.1530-9134.2008.00173.x
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    References listed on IDEAS

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