Title

Selling Information

Document Type

Discussion Paper

Publication Date

12-1-2009

CFDP Number

1743

CFDP Revision Date

2010-08-01

CFDP Pages

55

Abstract

We study a dynamic buyer-seller problem in which the good is information and there are no property rights. The potential buyer is reluctant to pay for information whose value to him is uncertain, but the seller cannot credibly convey its value to the buyer without disclosing the information itself. Information comes as divisible hard evidence. We show how and why the seller can appropriate a substantial fraction of the value through gradual revelation, and how the entire value can be extracted with the help of a mediator.

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