Quality disclosure pattern options for competing refurbishers: blockchain vs online platform

The study considers competing refurbishers to produce heterogeneous levels of quality and disclose quality through two patterns: online retailer sales or direct blockchain adoption. By developing a duopoly model, the study explores the implementation conditions of different quality disclosure patterns for refurbishers and equilibrium disclosure patterns in the competing market using a game theory. A novel finding is that the choice of disclosure pattern for low-quality refurbishers is only related to blockchain costs, while the choice for high-quality refurbishers sometimes also depends on the quality gap between two competing products. When the low-quality refurbisher invests directly in blockchain to disclose, if the quality gap is large enough, the high-quality refurbisher will opt for blockchain disclosure. Otherwise, it chooses blockchain disclosure only when the cost of blockchain is low. Refurbishers' willingness for different disclosure patterns varies with the counterparty’s pattern and the high-quality refurbisher is also influenced by the product quality gap.