Konferenzbeitrag

Platform Collusion in Two-Sided Markets

This papers analyses price collusion between platforms in a two-sided market model based on Armstrong (2006). In particular, it addresses Evans and Schmalensee's hypothesis of collusion being harder to sustain because of feedback effects and stronger requirements concerning agreements and monitoring. Results imply that growing indirect network externalities have two opposing effects on the sustainabilty of a cartel. First, collusive profits increase while stage game Nash profits fall making collusion more desirable. Second, however, the incentive to deviate increases as demand reactions become stronger. In total, the latter effect dominates and collusion becomes harder to sustain as indirect network externalities increase.

Language
Englisch

Bibliographic citation
Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie - Session: Two-Sided Markets and Vertical Restraints ; No. E8-V2

Classification
Wirtschaft
Monopolization; Horizontal Anticompetitive Practices
Monopoly; Monopolization Strategies
Antitrust Issues and Policies: General

Event
Geistige Schöpfung
(who)
Ruhmer, Isabel
Event
Veröffentlichung
(who)
Verein für Socialpolitik
(where)
Frankfurt a. M.
(when)
2010

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Konferenzbeitrag

Associated

  • Ruhmer, Isabel
  • Verein für Socialpolitik

Time of origin

  • 2010

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