INFORMATION SHARING AND PRICE DYNAMICS IN B2B DIGITAL SYSTEMS

While multiple studies have investigated the digital ecosystems in the B2C sectors, empirical research on the upstream of the supply chain is still underexplored. This paper examines the case when a digital platform is incorporated into the century-old auction system. This work offers insights into B2B markets and at the same time, an interesting instance where different pricing mechanisms (online posted price and auctions) co-exist. We investigate how the information of the new digital posted price channel can influence buyers' learning behaviors and consequently, the price dynamics in the auction market. Our empirical analysis reveals that multiple information signals can play a role. While sellers' high price and high-volume sales signals can partially dimmish the existing declining price trend in the sequential auctions where the prices from the earlier auction rounds tend to be higher than from the latter, this information effect does not persist over time. These results highlight the potential benefit of cooperating e-commerce with an auction channel for sellers and the shift in buyers' behaviors in responding to an additional platform in a B2B market.