Blockchain's role in e-commerce sellers' decision-making on information disclosure under competition

Area of Science:

• E-commerce
• Information Economics
• Blockchain Technology

Background:

• E-commerce sellers face challenges with product information distortion and loss.
• Blockchain offers immutability and traceability to improve information disclosure and transmission efficiency.

Purpose of the Study:

• To analyze the impact of blockchain on information disclosure and consumer surplus in a competitive e-commerce duopoly.
• To determine the conditions for Nash equilibrium in blockchain adoption for competing sellers.

Main Methods:

• Developed a game model analyzing four scenarios: NN, BN, NB, BB (N=No Blockchain, B=Blockchain).
• Incorporated consumer utility to derive market demand and analyze seller decisions.
• Expanded the model to include seller risk aversion and capital constraints.

Main Results:

• Blockchain adoption is favored when consumer trust is low or blockchain costs are low.
• Increased consumer risk aversion hinders blockchain equilibrium when trust is low.
• For capital-constrained sellers, high bank financing rates impede blockchain equilibrium when costs are low.

Conclusions:

• Blockchain significantly enhances information disclosure and consumer surplus in competitive e-commerce.
• The decision to adopt blockchain is influenced by information trust, application costs, and seller-specific factors like risk aversion and capital constraints.
• Blockchain implementation in e-commerce supply chains can mitigate information asymmetry and improve market outcomes.