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Measuring Markets for Network Goods

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Listed:
  • Leonardo Bursztyn
  • Matthew Gentzkow
  • Rafael Jiménez-Durán
  • Aaron Leonard
  • Filip Milojević
  • Christopher Roth

Abstract

Market definition is essential for antitrust analysis, but challenging in settings with network effects, where substitution patterns depend on changes in network size. To address this challenge, we conduct an incentivized experiment to measure substitution patterns for TikTok, a popular social media platform. Our experiment, conducted during a time of high uncertainty about a potential U.S. TikTok ban, compares changes in the valuation of other social apps under individual and collective TikTok deactivations. Consistent with a simple framework, the valuations of alternative social apps increase more in response to a collective TikTok ban than to an individual TikTok deactivation. Our framework and estimates highlight that individual and collective treatments can even lead to qualitatively different conclusions about which alternative goods are substitutes.

Suggested Citation

  • Leonardo Bursztyn & Matthew Gentzkow & Rafael Jiménez-Durán & Aaron Leonard & Filip Milojević & Christopher Roth, 2025. "Measuring Markets for Network Goods," NBER Working Papers 33901, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:33901
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    Cited by:

    1. Kevin Zielnicki & Guy Aridor & Aur'elien Bibaut & Allen Tran & Winston Chou & Nathan Kallus, 2025. "The Value of Personalized Recommendations: Evidence from Netflix," Papers 2511.07280, arXiv.org, revised Nov 2025.
    2. Kevin Zielnicki & Guy Aridor & Aurelien Bibaut & Allen Tran & Winston Chou & Nathan Kallus, 2025. "The Value of Personalized Recommendations: Evidence from Netflix," CESifo Working Paper Series 12257, CESifo.

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    More about this item

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • L0 - Industrial Organization - - General
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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