Collective Consuming: Consumers as Subcontractors on Electronic Markets
In this article, contrary to popular belief, it is argued on the basis of Transaction Cost Economics that consumers will become dependent subcontractors on electronic markets. Consumers invest time and effort building up a relation with a producer or e-tailer; an investment that is idiosyncratic. The producer or e-tailer only needs to invest in generic assets that enable him to automate the process of collecting and processing customer information she needs to differentiate products and discriminate prices. As subcontractors consumers face high switching costs and are thus dependent on producers or e-tailers. Virtual communities of consumers that organize countervailing power will not mitigate this tendency.
|Date of creation:||03 Apr 2005|
|Contact details of provider:|| Postal: RSM Erasmus University & Erasmus School of Economics, PoBox 1738, 3000 DR Rotterdam|
Phone: 31-10-408 1182
Fax: 31-10-408 9020
Web page: http://www.erim.eur.nl/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:ems:eureri:1932. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (RePub)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.