Pricing and commitment by two-sided platforms

Abstract

I study pricing and commitment by platforms in two-sided markets with the following characteristics: (i) platforms are essential bottleneck inputs for buyers and sellers transacting with each other; (ii) sellers arrive before buyers; and (iii) platforms can charge both fixed fees and variable fees (royalties). I show that a monopoly platform may prefer not to commit to the price it will charge buyers at the same time it announces its seller price if it faces unfavorable seller expectations. With competing platforms, commitment makes the existence of an exclusive equilibrium (in which sellers register with only one platform) less likely, but it has no impact on multi-homing equilibria (in which sellers support both platforms) whenever these exist.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 526 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.