Exclusivity and exclusion on platform markets
AbstractWe examine conditions under which a platform firm can exclude rivals by bundling a product that some on one side of the market regard as essential with its platform, and pursue implications for market performance. We show that the impact of an exclusive dealing contract between the upstream firm and one of the downstream firms on market performance depends on the strength of consumer preferences for the products of the two downstream Firms and the relative size of the market segment for which the complementary consumption good is essential. In some cases this may reduce the net social welfare.
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Bibliographic InfoPaper provided by School of Economics, University of East Anglia, Norwich, UK. in its series Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) with number 10-14.
Date of creation: 01 Sep 2010
Date of revision:
Postal: Helen Chapman, School of Economics, University of East Anglia, Norwich Research Park, Norwich, NR4 7TJ, UK
Other versions of this item:
- L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts
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- Matthew Ellman & Fabrizio Germano, 2009. "What do the Papers Sell? A Model of Advertising and Media Bias," Economic Journal, Royal Economic Society, vol. 119(537), pages 680-704, 04.
- Elena Argentesi, 2004. "Demand Estimation for Italian Newspapers: The Impact of Weekly Supplements," Economics Working Papers ECO2004/28, European University Institute.
- María Fernanda Viecens, 2009. "Pricing strategies in two-sided platforms: The role of sellers’ competition," Working Papers 2009-11, FEDEA.
- Dewenter, Ralf, 2003. "Media Markets with Habit Formation," Working Paper 5/2003, Helmut Schmidt University, Hamburg.
- Jihui Chen, 2011. "Do Exclusivity Arrangments Harm Consumers?," Working Paper Series 20111001, Illinois State University, Department of Economics.
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