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Why Are Some Social Media Sites Free to Use?

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If companies always try to maximize profits, why are so many social media sites free to use? Learn how these platforms operate, as well as what positive and negative “network effects” are at play, in this May 2023 issue of Page One Economics.

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  • Mary Clare Peate, 2023. "Why Are Some Social Media Sites Free to Use?," Page One Economics Newsletter, Federal Reserve Bank of St. Louis, pages 1-5, May.
    • Handle: RePEc:fip:fedlpo:96075
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    References listed on IDEAS

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    1. Belleflamme,Paul & Peitz,Martin, 2021. "The Economics of Platforms," Cambridge Books, Cambridge University Press, number 9781108710749, January.
    2. Jens-Uwe Franck & Martin Peitz, 2021. "Market Definition in the Platform Economy," CRC TR 224 Discussion Paper Series crctr224_2021_259v2, University of Bonn and University of Mannheim, Germany.
    3. Belleflamme, Paul & Peitz, Martin, 2021. "The Economics of Platforms : Concepts and Strategy," LIDAM Reprints CORE 3185, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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    Keywords

    social media; network effects;

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