A Price Theory of Multi-sided Platforms: Comment

S-Tier
Journal: American Economic Review
Year: 2018
Volume: 108
Issue: 9
Pages: 2758-60

Score contribution per author:

4.022 = (α=2.01 / 2 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Weyl (2010) shows that in multi-sided platform settings, profit maximization leads to classical and Spence distortions, with the Spence distortion providing a new explanation for why prices may sometimes be too high (or too low) on platforms. However, the key formulas Weyl gives comparing privately and socially optimal prices are misstated. Properly interpreted, his results only explain marginal incentives with respect to setting prices and not the total distortion in prices, which can be very different.

Technical Details

RePEc Handle
repec:aea:aecrev:v:108:y:2018:i:9:p:2758-60
Journal Field
General
Author Count
2
Added to Database
2026-01-29