Abstract

In this paper, we study pricing mechanisms’ performance and their effects on the participants in the data industry. We obtain analytical solutions in three pricing mechanisms, including the decentralized and centralized pricing, Nash Bargaining pricing, and revenue sharing mechanism. Our first result show that the decentralized pricing has the lowest performance. We also find that revenue sharing mechanism can achieve the first best performance and divide the maximum profit arbitrarily. Nash Bargaining pricing can achieve the centralized channel performance, the upstream data provider and downstream application provider can only equally divide the total channel profit.

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