Platform-Intermediated Trade with Uncertain Quality
Consider trade conducted via a platform , such as an online app store or a farmers' market. The quality sellers choose for their products affects the surplus trade generates. Because the platform's profit depends on that surplus, the platform can have an incentive to regulate quality. This is true even if quality is observable at time of purchase or if sellers can develop reputations concerning quality. It is also true if the platform charges sellers only; that is, even if the platform has no direct interest in buyers' well-being.
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Volume (Year): 172 (2016)
Issue (Month): 1 (March)
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References listed on IDEAS
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- Sundaram,Rangarajan K., 1996. "A First Course in Optimization Theory," Cambridge Books, Cambridge University Press, number 9780521497190, September.
- Mussa, Michael & Rosen, Sherwin, 1978. "Monopoly and product quality," Journal of Economic Theory, Elsevier, vol. 18(2), pages 301-317, August.
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- George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, Oxford University Press, vol. 84(3), pages 488-500.
- Klein, Benjamin & Leffler, Keith B, 1981. "The Role of Market Forces in Assuring Contractual Performance," Journal of Political Economy, University of Chicago Press, vol. 89(4), pages 615-641, August. Full references (including those not matched with items on IDEAS)
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