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Effects of Conferring Business Resource on Rivals

Author

Listed:
  • Ajit, Tejaswi Channagiri
  • Jamison, Mark A.

Abstract

We examine how requiring platforms to give rivals resources, such as data, affects innovation. Using simulations in which an initial firm obtains a head start on rivals and uses that head start to build a valuable resource that subsequently gives it a competitive advantage over rivals when competing in the initial technology, we contrast scenarios in which the initial firm is or is not required by a government regulator to provide this resource to rivals. We develop pricing provisions that incentivize the initial firm to voluntarily provide the resource to rivals. We then contrast incentives to create substitutes for the initial technology.

Suggested Citation

  • Ajit, Tejaswi Channagiri & Jamison, Mark A., 2022. "Effects of Conferring Business Resource on Rivals," 31st European Regional ITS Conference, Gothenburg 2022: Reining in Digital Platforms? Challenging monopolies, promoting competition and developing regulatory regimes 265609, International Telecommunications Society (ITS).
    • Handle: RePEc:zbw:itse22:265609
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    More about this item

    Keywords

    platforms; innovation; competition;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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