Study on Option Price Model of the Transaction of Information Commodities

Changping HU, Xianjun QI
DOI: 10.4236/jssm.2009.24047                

Abstract

The option is viewed as an important tool of setting price in accordance with objective benefits and actual effectiveness of information commodities, as ensures that the holder of the option right acquires more benefits in the favorable market and reduces losses in the adverse market. And the information market, as a kind of typical monopolistic and com-petitive market, is especially adequate for introducing the option theory to set more reasonable price and further to improve the operational efficiency of information market. Hence, it is quite necessary to apply the option theory to the transaction of information commodities. In this paper, after analyzing the applicability of the option theory to the in-formation market and studying the option price of information commodities, the authors put forward the option price model of the transaction, followed by a case study to demonstrate the validity of the model.

Keywords

Information Commodities, Market Mechanism, Option Pricing, Transaction Model

Conflicts of Interest

The authors declare no conflicts of interest.

References

[1]	H. Q. Ma and C. Zong, “Analysis on the implementation efficiency problems and countermeasures about the policy and regulations for the network information resources construction and location,” Library and Information, Vol. 10, pp. 31–35, 2006.
[2]	X. J. Zha, “The allocation of resources and sharing of information,” Wuhan University Press, Wuhan, 2008.
[3]	F. C. Ma, G. Li, and X. J. Zha, “Information resources management,” Wuhan University Press, Wuhan, 2001.
[4]	W. Y. Xu and L. N. Li, “Study on information resources effective allocation under the conditions of market economy,” Journal of Information, Vol. 11, pp. 128–131, 2005.
[5]	L. Huan and Y. Jiang, “Research on the Multi-prices Pric-ing Model of Information Product,” Finance and Eco-nomics, Vol. 4, pp. 63–66, 2002.
[6]	F. C. Ma and X. G. Wang, “Pricing strategies and meth-ods of information commodities,” Information Studies: Theory & Application, Vol. 3, pp. 285–287, 2003.
[7]	F. Ancarani and V. Shankar, “Price levels and price dis-persion on the internet: A comparison of pure play inter-net, bricks-and-mortar, and bricks-and-clicks retailers,” Business Research Center Working Paper, 2002.
[8]	L. Trigeorgis, “Real options: Managerial flexibility and strategy in resource allocation,” MIT Press, 1996.
[9]	H. L. Yu, “Financial options and real options: Compari-son and application,” Shanghai University Finance & Economics Press, Shanghai, 2003.
[10]	A. K. Dixit and R. S. Pindyck, “Investment under uncer-tainty,” Princeton University Press, Princeton, 1996.
[11]	P. Mirowski and E. M. Sent, “Science bought and sold: Essays in the economics of science,” University of Chi-cago Press, Chicago, 2002.
[12]	J. A. Campbell, “Real options analysis of the timing of IS investment decisions,” Information & Management, Vol. 39, pp. 357–364, 2002.
[13]	M. Benaroch, “A real options perspective of forthcom-ing,” Journal of Management Information Systems, Vol. 1, pp. 23–31, 2002.
[14]	F. Black and M. Scholes, “The pricing of options and corporate liabilities,” Journal of Political Economy, Vol. 4, pp. 81–93, 1973.
[15]	J. C. Hull, “Options, futures and other derivative securi-ties (2th),” Prentice-Hall, Englewood Cliffs, NJ, 1993.