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Market entry into emerging two-sided markets

Author

Listed:
  • Ralf Dewenter

    (University of Duesseldorf)

  • Juergen Roesch

    (University of Duesseldorf)

Abstract

This note analyzes the impact of indirect network effects in emerging two-sided markets on prices, quantities, profits and market entry assuming market enlargement induced by indirect network effects. Only if indirect network effects are small, the conventional results of market entry apply, although weakened. If, however, the interconnection between the markets is strong, tighter market structures or even monopolies can be optimal.

Suggested Citation

  • Ralf Dewenter & Juergen Roesch, 2012. "Market entry into emerging two-sided markets," Economics Bulletin, AccessEcon, vol. 32(3), pages 2343-2352.
    • Handle: RePEc:ebl:ecbull:eb-12-00572
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    File URL: http://www.accessecon.com/Pubs/EB/2012/Volume32/EB-12-V32-I3-P227.pdf
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    References listed on IDEAS

    as
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    Cited by:

    1. Budzinski Oliver & Köhler Karoline Henrike, 2015. "Is Amazon The Next Google?," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 66(1), pages 263-288, January.
    2. Dewenter Ralf & Rösch Jürgen, 2016. "Net Neutrality and the Incentives (Not) to Exclude Competitors," Review of Economics, De Gruyter, vol. 67(2), pages 209-229, August.
    3. Lei Bao & Yulin Zhang & Vitor Miguel Ribeiro, 2018. "Observability of Incentive Contract and Platform Competition," Australian Economic Papers, Wiley Blackwell, vol. 57(2), pages 154-180, June.

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    More about this item

    Keywords

    Market entry; two-sided markets; emerging markets.;
    All these keywords.

    JEL classification:

    • L0 - Industrial Organization - - General
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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