In this paper we construct a simple model of platform price competition with two main novel features. First, platforms endogenously decide the quality of their `access service' and second, each group exhibits preferences not only about the number of agents in the opposite group, but also about their type or quality. Additionally, sellers also care about the type of agents in their own group. Our interest is to examine the set of conditions under which, in spite of the network externalities, more than one plaftorm coexist in equilibrium. We show that when quality is endogenously determined by the choices of agents these platforms could be asymmetric.
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Paper provided by Universidad Carlos III, Departamento de Economía in its series Economics Working Papers with number
we061204.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Volker Nocke & Martin Peitz & Konrad Stahl, 2004.
"Platform Ownership,"
Discussion Papers
16, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
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Other versions:
Volker Nocke & Martin Peitz & Konrad Stahl, 2004.
"Platform Ownership,"
PIER Working Paper Archive
04-029, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
[Downloadable!]
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