Summer 2010, Volume 7, Number 2

In this issue: This issue, organized by guest editor Glen Weyl, concerns one of the hottest topics in antitrust and economics—two-sided markets. Understanding the distinction between conventional and two-sided markets is a necessary challenge for practitioners, corporate executives, and regulators alike; our writers investigate some of these differences. Lapo Filistrucchi questions how many markets are, […]

Estelle Cantillon, Pai-Ling Yin, Jul 27, 2010 Demand in platform competition is characterized by a 2-stage game: first, demanders decide whether to adopt a platform, and THEN they decide how much to use the platform. However, with the exception of Bedre & Calvano (2010) and Cantillon & Yin (2010), the distinction between membership demand and […]

Hanna Halaburda, Mikolaj Jan Piskorski, Jul 27, 2010 Existing economic wisdom offers unequivocal advice to managers seeking to establish new platform businesses: Invest to acquire users as quickly as possible and make sure that they have unrestricted access to each other. Since the value of participating in a platform often depends on the number of […]

Lapo Filistrucchi, Jul 27, 2010 There is a lot of talk nowadays, among competition policy practitioners, about two-sided markets and two-sided platforms. It is indeed one of the hot topics. Part of the interest arises from it being a relatively new concept and part is due to the claim from many economists that competition policy […]

Joshua Gans, Jul 27, 2010 Two-sided platforms have represented an antitrust challenge in a similar way to the challenge posed by innovation and dynamics. Put simply, a seeming lack of price competition to one set of consumers may mask competition for another, related set of consumers. That is, low competition within one side of the […]

Renato Gomes, Jul 27, 2010 The most valuable asset of many two-sided platforms is their user base. In a celebrated example, Internet search engines (such as Google, Yahoo! or Bing) derive most of their revenue from selling the eyeballs of millions of searchers to advertisers. For each query entered by searchers, search engines return a […]

Kaushal Sharma, Shanker Singham, Jul 27, 2010 A two-sided market refers to a type of economic transaction or network in which there are two distinct user groups and the demands of each group are both dependent and subject to economies of scale. In their paper, Two-Sided Markets: A Progress Report, Rochet & Tirole describe a […]