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Asymmetric Price Competition on Hybrid Platforms: Theory and Evidence from Amazon

Author

Listed:
  • Luise Eisfeld

    (University of Lausanne)

  • Jun Yan

    (Xiamen University)

  • Li Yu

    (Liaoning University)

Abstract

We study how hybrid platform operation, in which a platform competes with third-party sellers while charging a commission on their sales, shapes pricing incentives. Our model identifies two channels induced by the ad valorem commission - revenue sharing and double markup - that generate asymmetric pricing behavior between the platform and third-party sellers. Using data from Amazon's U.S. marketplace, we find patterns consistent with the model's predictions: third-party prices respond modestly more strongly to third-party entry and exit than to Amazon entry and exit, and significantly more strongly than Amazon prices do to common commodity cost shocks.

Suggested Citation

  • Luise Eisfeld & Jun Yan & Li Yu, 2026. "Asymmetric Price Competition on Hybrid Platforms: Theory and Evidence from Amazon," Swiss Finance Institute Research Paper Series 26-62, Swiss Finance Institute.
    • Handle: RePEc:chf:rpseri:rp2662
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    File URL: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=7437279
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    Keywords

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    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles

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