Hybrid platform model: monopolistic competition and a dominant firm

A-Tier
Journal: RAND Journal of Economics
Year: 2024
Volume: 55
Issue: 4
Pages: 684-718

Authors (2)

Simon Anderson (University of Virginia) Özlem Bedre Defolie (not in RePEc)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

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

Abstract

We model a platform controlling the variety and prices of the products it hosts via a percentage fee on sellers and choosing whether to sell its own products (hybrid mode). We derive a mixed market demand system for differentiated products with monopolistically competitive sellers and a sizeable platform product range. The hybrid platform steers consumers toward its products by charging higher seller fees than pure marketplace. This “insidious steering” intensifies the larger the platform's product footprint. Hybrid mode harms consumers compared to pure marketplace unless fringe entry is sufficiently inelastic.

Technical Details

RePEc Handle
repec:bla:randje:v:55:y:2024:i:4:p:684-718
Journal Field
Industrial Organization
Author Count
2
Added to Database
2026-01-24