Here’s an Opportunity: Knowledge Sharing Among Competitors as a Response to Buy-in Uncertainty

Although knowledge sharing among competitors is seemingly counterintuitive, scholars have found that competitors share knowledge under certain conditions: among actors who have a preexisting relationship and who expect direct reciprocity. However, there are examples of knowledge sharing among competitors that cannot fully be explained using these relational mechanisms. In this study, I propose that in markets where competitors are a set of key stakeholders, knowledge sharing is a strategic response to high levels of buy-in uncertainty related to a potential opportunity, namely, the likelihood that stakeholders will come to realize the value of a potential opportunity in a timely fashion. Using a unique data set of knowledge sharing among investment professionals on a digital platform, this study leverages variation in the platform’s knowledge-sharing structure to test this theory. I find that knowledge sharing among these competitors is most likely when buy-in uncertainty for a given opportunity is high and that this knowledge sharing does lead to subsequent buy-in.