Information asymmetries: A source of competitive advantage for diversified service firms

Information asymmetries: A source of competitive advantage for diversified service firms Information asymmetries are generally considered as leading to costs for both parties in an exchange transaction. They can, however, also be a source of competitive advantage. Potential buyers face information asymmetries in evaluating services prior to purchase. Since such asymmetries impose costs on buyers, there exists an incentive to lower such costs. This incentive may be exploited by service firms that diversify into other services that meet the needs of existing customers. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Strategic Management Journal Wiley

Information asymmetries: A source of competitive advantage for diversified service firms

Strategic Management Journal, Volume 11 (7) – Nov 1, 1990

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Publisher
Wiley
Copyright
Copyright © 1990 John Wiley & Sons, Ltd.
ISSN
0143-2095
eISSN
1097-0266
DOI
10.1002/smj.4250110703
Publisher site
See Article on Publisher Site

Abstract

Information asymmetries are generally considered as leading to costs for both parties in an exchange transaction. They can, however, also be a source of competitive advantage. Potential buyers face information asymmetries in evaluating services prior to purchase. Since such asymmetries impose costs on buyers, there exists an incentive to lower such costs. This incentive may be exploited by service firms that diversify into other services that meet the needs of existing customers.

Journal

Strategic Management JournalWiley

Published: Nov 1, 1990

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