Incentives for Quality over Time - The Case of Facebook Applications
AbstractWe study the market for applications on Facebook, the dominant platform for social networking and make use of a rule change by Facebook by which high-quality applications were rewarded with further opportunities to engage users. We find that the change led to quality being a more important driver of usage while sheer network size became less important. Further, we find that update frequency helps applications maintain higher usage, while generally usage of Facebook applications declines less rapidly with age.
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Bibliographic InfoPaper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp1133.
Date of creation: Mar 2012
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usage intensity; social media; platform management; two-sided markets;
Other versions of this item:
- Claussen, Jörg & Kretschmer, Tobias & Mayrhofer, Philip, 2010. "Incentives for Quality over Time – The Case of Facebook Applications," Discussion Papers in Business Administration 12500, University of Munich, Munich School of Management.
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-03-14 (All new papers)
- NEP-CUL-2012-03-14 (Cultural Economics)
- NEP-ICT-2012-03-14 (Information & Communication Technologies)
- NEP-MKT-2012-03-14 (Marketing)
- NEP-NET-2012-03-14 (Network Economics)
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