Working Paper: NBER ID: w16852
Authors: Jonathan D. Levin
Abstract: The internet has facilitated the creation of new markets characterized by large scale, increased customization, rapid innovation and the collection and use of detailed consumer and market data. I describe these changes and some of the economic theory that has been useful for thinking about online advertising markets, retail and business-to-business e-commerce, internet job matching and financial exchanges, and other internet platforms. I also discuss the empirical evidence on competition and consumer behavior in internet markets and some directions for future research.
Keywords: No keywords provided
JEL Codes: C78; D4; D44; L10; L14; O33
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Scalability of internet platforms (D26) | Reduced costs of serving additional users (D16) |
| Reduced costs of serving additional users (D16) | Facilitates rapid growth and competition among platforms (D26) |
| Customization in online markets (D40) | Enhanced efficiency of matching consumers with products (D16) |
| Enhanced efficiency of matching consumers with products (D16) | Improved consumer experiences (D16) |
| Improved consumer experiences (D16) | Potentially higher sales (D49) |
| Rapid innovation (O35) | Competitive advantages for platforms (D26) |