Arbeitspapier

Self-preferencing, Quality Provision, and Welfare in Mobile Application Markets

Platforms often display their products ahead of third-party products in search. Is this due to consumers preferring platform-owned products or platforms engaging in self-preferencing by biasing search towards their own products? What are the welfare implications? I develop a structural model of mobile application markets to identify self-preferencing and quantify its welfare effects, taking into account third-party developers' quality adjustment. A new dataset on app downloads, prices, characteristics, and search rankings is used to estimate the model. Estimates indicate self-preferencing. Simulations show higher consumer welfare and third-party profits without self-preferencing.

Language
Englisch

Bibliographic citation
Series: Discussion Paper ; No. 434

Classification
Wirtschaft
Consumer Economics: Empirical Analysis
Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
Oligopoly and Other Imperfect Markets
Information and Internet Services; Computer Software
Subject
competition policy
platform design
consumer search
endogenous product choice

Event
Geistige Schöpfung
(who)
Teng, Xuan
Event
Veröffentlichung
(who)
Ludwig-Maximilians-Universität München und Humboldt-Universität zu Berlin, Collaborative Research Center Transregio 190 - Rationality and Competition
(where)
München und Berlin
(when)
2023

Handle
Last update
10.03.2025, 11:45 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Teng, Xuan
  • Ludwig-Maximilians-Universität München und Humboldt-Universität zu Berlin, Collaborative Research Center Transregio 190 - Rationality and Competition

Time of origin

  • 2023

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