General Network Effects and Welfare
Abstract(In)direct network effects arise frequently in economic models but, for reasons of analytical tractability, are often assumed to be linear. Here, we examine the general non-linear case with two platforms. We establish the conditions characterising equilibria and show that welfare changes can be related in a simple, intuitive way to the degree of diminishing returns of the network effects function.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 0915.
Date of creation: 07 Apr 2009
Date of revision:
Contact details of provider:
Web page: http://www.econ.cam.ac.uk/index.htm
Network Effects; Indirect Network Effects; Platforms; Welfare;
Find related papers by JEL classification:
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-04-13 (All new papers)
- NEP-COM-2009-04-13 (Industrial Competition)
- NEP-IND-2009-04-13 (Industrial Organization)
- NEP-MIC-2009-04-13 (Microeconomics)
- NEP-NET-2009-04-13 (Network Economics)
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.:
- Pollock, Rufus, 2005.
"The Control of Porting in Two-Sided Markets,"
5023, University Library of Munich, Germany, revised Jun 2007.
- Pollock, R., 2007. "The Control of Porting in Two-Sided Markets," Cambridge Working Papers in Economics, Faculty of Economics, University of Cambridge 0754, Faculty of Economics, University of Cambridge.
- Church Jeffrey & Gandal Neil & Krause David, 2008.
"Indirect Network Effects and Adoption Externalities,"
Review of Network Economics, De Gruyter,
De Gruyter, vol. 7(3), pages 1-22, September.
- Jeffrey Church & Neil Gandal & David Krause, 2003. "Indirect Network Effects and Adoption Externalities," Microeconomics, EconWPA 0301001, EconWPA.
- Church, Jeffrey & Gandal, Neil & Krause, David, 2003. "Indirect Network Effects and Adoption Externalities," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3738, C.E.P.R. Discussion Papers.
- Caillaud, Bernard & Jullien, Bruno, 2003. " Chicken & Egg: Competition among Intermediation Service Providers," RAND Journal of Economics, The RAND Corporation, vol. 34(2), pages 309-28, Summer.
- Church, Jeffrey & Gandal, Neil, 1992. "Network Effects, Software Provision, and Standardization," Journal of Industrial Economics, Wiley Blackwell, Wiley Blackwell, vol. 40(1), pages 85-103, March.
- Tim Paul Thomes, 2010. "Vertically Related Markets of Collective Licensing of Differentiated Copyrights with Indirect Network Effects," Jena Economic Research Papers 2010-056, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Howard Cobb).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.