Working Paper: NBER ID: w18783
Authors: David S. Evans; Richard Schmalensee
Abstract: This Chapter provides a survey of the economics literature on multi-sided platforms with particular focus on competition policy issues, including market definition, mergers, monopolization, and coordinated behavior. It provides a survey of the general industrial organization theory of multi-sided platforms and then considers various issues concerning the application of antitrust analysis to multi-sided platform businesses. It shows that it is not possible to know whether standard economic models, often relied on for antitrust analysis, apply to multi-sided platforms without explicitly considering the existence of multiple customer groups with interdependent demand. It summarizes many theoretical and empirical papers that demonstrate that a number of results for single-sided firms, which are the focus of much of the applied antitrust economics literature, do not apply directly to multi-sided platforms.
Keywords: No keywords provided
JEL Codes: L19; L40
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| traditional economic models (F11) | interdependent demand (R22) |
| interdependent demand (R22) | market definition (G10) |
| interdependent demand (R22) | competitive behavior (L13) |
| pricing strategies (D49) | consumer welfare (D69) |
| pricing strategies (D49) | platform welfare (P16) |
| indirect network effects (D85) | platform's value (D46) |
| merger of two multisided platforms (D26) | prices on both sides (P22) |