Behavior-based personalized pricing: when firms can share customer information

Chongwoo Choe, Noriaki Matsushima, Mark J. Tremblay

Research output: Contribution to journalArticleResearchpeer-review

5 Citations (Scopus)


We study a two-period model of behavior-based price discrimination where firms can agree to share customer information before the first-period competition begins, and the information can be used for personalized pricing in the second-period competition. We show that information sharing is individually rational for firms as it softens upfront competition when information is gathered, consumers are worse off as a result, but total surplus can increase thanks to the improved quality of matching between firms and consumers. These findings are robust to firm asymmetries and varying discount factors for consumers and firms.

Original languageEnglish
Article number102846
Number of pages17
JournalInternational Journal of Industrial Organization
Publication statusPublished - May 2022


  • Behavior-based price discrimination
  • Information sharing
  • Personalized pricing

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