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Welfare effects of jointly managed non-targeted advertising in multi-sided media markets

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  • Brito, Duarte
  • Vasconcelos, Helder

Abstract

We examine the welfare effects of joint advertising by two competing media platforms that attract viewers through subscription pricing while also generating revenue by selling advertisers access to their subscriber base. Focusing on non-targeted advertising, we show that while joint advertising consistently reduces consumer welfare, its overall impact on total welfare remains uncertain. Crucially, this effect depends on the nuisance cost of advertising to consumers, with total welfare potentially increasing when this cost falls within an intermediate range.

Suggested Citation

  • Brito, Duarte & Vasconcelos, Helder, 2025. "Welfare effects of jointly managed non-targeted advertising in multi-sided media markets," Economics Letters, Elsevier, vol. 253(C).
    • Handle: RePEc:eee:ecolet:v:253:y:2025:i:c:s0165176525002204
    DOI: 10.1016/j.econlet.2025.112383
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    References listed on IDEAS

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    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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