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Burdens and Balancing in Multisided Markets: The First Principles Approach of Ohio v. American Express

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  • Joshua D. Wright

    (George Mason University)

  • John M. Yun

    (George Mason University)

Abstract

Multisided platforms have distinct and critical features that set them apart from single-sided markets. This realization has led to a split among courts, antitrust practitioners, and economists as to the best method to assess whether mergers or conduct that involve platforms result in the creation or maintenance of monopoly power and violate the antitrust laws. Some argue that each side of a platform constitutes a separate relevant product market. Others argue for a single, integrated market that incorporates all sides. We argue that any prima facie antitrust assessment of competitive harm must incorporate the impact to consumers on all sides regardless of market definition. We also explain why output effects should be the primary emphasis of competitive effects analyses. The Supreme Court recently and correctly adopted this approach in Ohio v. American Express.

Suggested Citation

  • Joshua D. Wright & John M. Yun, 2019. "Burdens and Balancing in Multisided Markets: The First Principles Approach of Ohio v. American Express," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(4), pages 717-740, June.
  • Handle: RePEc:kap:revind:v:54:y:2019:i:4:d:10.1007_s11151-019-09677-7
    DOI: 10.1007/s11151-019-09677-7
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    Cited by:

    1. Cosnita-Langlais, Andreea & Johansen, Bjørn Olav & Sørgard, Lars, 2021. "Upward pricing pressure in two-sided markets: Incorporating rebalancing effects," International Journal of Industrial Organization, Elsevier, vol. 74(C).
    2. Juan Manuel Sanchez‐Cartas & Gonzalo León, 2021. "Multisided Platforms And Markets: A Survey Of The Theoretical Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 35(2), pages 452-487, April.
    3. Miller, Tracy, 2021. "Evaluating Arguments for Antitrust Action against Tech Companies," Annals of Computational Economics, George Mason University, Mercatus Center, May.

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