Non-cooperative incentives to share knowledge in competitive environments

In this paper we study a model where non-cooperative agents may exchange knowledge in a competitive environment. As a potential factor that could induce the knowledge disclosure between humans we consider the timing of the moves of players. We develop a simple model of a multistage game in which there are only three players and competition takes place only within two stages. Players can share their private knowledge with their opponents and the knowledge is modelled as influencing their marginal cost of effort. We identify two main mechanisms that work towards knowledge disclosure. One of them is that before the actual competition starts, the stronger player of the first stage of a game may have desire to share his knowledge with the "observer", because this reduces the valuation of the prize of the weaker player of that stage and as a result his effort level and probability of winning in a fight. Another mechanism is that the "observer" may have sometimes desire to share knowledge with the weaker player of the first stage, because in this way, by increasing his probability of winning in that stage, he decreases the probability of winning of the stronger player. As a result, in the second stage the "observer" may have greater chances to meet the weaker player rather than the stronger one.