We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Costly Information Disclosure in Oligopoly.
- Authors
Insuk Cheong, Margaret E.; Jeong-Yoo Kim
- Abstract
We examine the effect of competition on the incentive of firms to disclose quality to consumers before trade when information disclosure is not costless. We demonstrate that no firm will disclose information in the limit, no matter how small the disclosure cost is; that is, the market outcome converges to complete concealment of information as the number of competing firms becomes larger. Nonetheless, it can be shown that under a mild condition, the equilibrium amount of information disclosure is socially excessive for any number of firms, so discouraging information disclosure by levying a tax may increase social welfare.
- Subjects
DISCLOSURE; OLIGOPOLIES; COMPETITION; LABOR incentives; ECONOMIC equilibrium
- Publication
Journal of Industrial Economics, 2004, Vol 52, Issue 1, p121
- ISSN
0022-1821
- Publication type
Article
- DOI
10.1111/j.0022-1821.2004.00218.x