COALITION-PROOF INFORMATION EXCHANGES

In a three-firm oligopoly model we show that, in addition to being a s imple Nash equilibrium, information sharing among all firms is sometim es coalition-proof, and, information exchange among a proper subset of the firms can constitute a coalition-proof equilibrium. Thus, informa tion exchange among firms, even without collusion on prices or outputs , can be very stable and may occur more widely than previously expecte d.