Skill Acquisition and Information Sales

Abstract

We develop an information-sales model in which investors acquire uncertain skills to interpret purchased data, thereby changing the behavior of data sellers. When a seller owns accurate data, she adds personalized noise to the sold data to dampen information leakage via asset prices. When she owns inaccurate data, she sells the data ìas is.îMarket variables often exhibit di§erent properties in these two types of equilibria. When skill acquisition of investors is uncertain, the seller cannot fully control information leakage, which leads to novel results such as price informativeness increasing with skill-acquisition costs. Our results help clarify certain empirical regularities.