Asymmetric networks in two-sided markets
Published
Journal Article
This paper investigates pricing decisions and network choices in twosided markets with network externalities. Consumers are heterogeneous in how much they value the externality. Imposing restrictions on the extent of coordination failure among consumers generates clear qualitative conclusions about equilibrium market configurations. Multiple asymmetric networks can coexist in equilibrium, both in the case of a monopolist network provider and in the case of competing providers. These equilibria have the property that one network is cheaper and larger on one side, while the other network is cheaper and larger on the other side. Product differentiation is endogenized by consumers' network choices.
Full Text
Duke Authors
Cited Authors
- Ambrus, A; Argenziano, R
Published Date
- February 1, 2009
Published In
Volume / Issue
- 1 / 1
Start / End Page
- 17 - 52
Electronic International Standard Serial Number (EISSN)
- 1945-7685
International Standard Serial Number (ISSN)
- 1945-7669
Digital Object Identifier (DOI)
- 10.1257/mic.1.1.17
Citation Source
- Scopus