Identifying Two-Sided Markets

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Abstract

Abstract: We review the burgeoning literature on two-sided markets focusing on the different definitions that have been proposed. In particular, we show that the well-known definition given by Evans is a particular case of the more general definition proposed by Rochet and Tirole. We then identify the crucial elements that make a market two-sided and, drawing from both theory and practice, derive suggestions for the identification of the two-sided nature of a market. Our suggestions are relevant not only for the analysis of traditional two-sided markets, such as newspapers and payment cards, but also for the analysis of many new markets, such as those for online social networks, online search engines and Internet news aggregators.
Original languageEnglish
Place of PublicationTilburg
PublisherTILEC
Number of pages26
Volume2012-008
Publication statusPublished - 2012

Publication series

NameTILEC Discussion Paper
Volume2012-008

Keywords

  • two-sided markets
  • platforms
  • network effects

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