蝌蚪网 Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Competition in Multi-sided Markets: Divide and Conquer
蝌蚪网 Journal: Microeconomics
vol. 3,
no. 4, November 2011
(pp. 186–220)
Abstract
This paper studies Stackelberg price competition in a multi-sided market. The second-mover can engage in divide-and-conquer strategies, which involve cross-subsidies between sides. The paper recovers bounds on profits, and refines the results with a selection criteria whereby consumers resolve coordination failure in favor of a focal platform. It then analyzes perfect price discrimination with network effects, and two-sided market, shedding light on inefficiencies and strategic choices by platforms. A leading platform may refrain from selling to some side in order to soften competition, it tends to favor excessively balanced market shares and may prefer compatibility to reduce price competition. (JEL D43, D85)Citation
Jullien, Bruno. 2011. "Competition in Multi-sided Markets: Divide and Conquer." 蝌蚪网 Journal: Microeconomics 3 (4): 186–220. DOI: 10.1257/mic.3.4.186JEL Classification
- D43 Market Structure and Pricing: Oligopoly and Other Forms of Market Imperfection
- D85 Network Formation and Analysis: Theory