Platform Competition in Two-Sided Markets.¶
Rochet, J., & Tirole, J. (2003). Platform Competition in Two-Sided Markets. Journal of the European Economic Association, 1(4), 990-1029.
Cited by¶
6 citations across 6 artifacts.
Each citation links to the sentence it supports in the citing article.
Primes¶
- Cross-Boundary Subsidy
- Platform and multi-product business: two-sided platform subsidies where advertisers fund users or one side funds the other; loss-leader pricing; "free" or below-cost goods sustained by donor-side surplus.
This sourceFoundational theory of two-sided platforms in which one side is subsidised by surplus from the other (cross-subsidy pricing).
- Platform and multi-product business: two-sided platform subsidies where advertisers fund users or one side funds the other; loss-leader pricing; "free" or below-cost goods sustained by donor-side surplus.
- Interior Lines
- Platform economics. A platform between many buyers and sellers occupies interior lines in the trade network, rebalancing attention and liquidity faster than the periphery can coordinate alternatives.
This sourceFoundational analysis of a platform intermediating between buyers and sellers and rebalancing the two sides.
- Platform economics. A platform between many buyers and sellers occupies interior lines in the trade network, rebalancing attention and liquidity faster than the periphery can coordinate alternatives.
- Network Effect
- "Platform Competition in Two-Sided Markets," Journal of the European Economic Association, 1(4):990–1029
This sourceFoundational formalization of two-sided platform markets; analyzes cross-side network effects and pricing structure; establishes framework for understanding payment networks, marketplaces, operating systems.
- "Platform Competition in Two-Sided Markets," Journal of the European Economic Association, 1(4):990–1029
- Registry-Mediated Discovery
- Marketplace and matchmaking platforms: drivers, hosts, or users register current availability and profile; others look up by criteria, and the platform mediates the discovery.
This sourcePlatforms act as matchmaking intermediaries that bring two sides together, mediating provider availability and consumer lookup.
- Marketplace and matchmaking platforms: drivers, hosts, or users register current availability and profile; others look up by criteria, and the platform mediates the discovery.
- Two Sided Market
- A two-sided market specifies distinct sides whose roles in the transaction are not interchangeable — buyers and sellers, readers and advertisers, cardholders and merchants, developers and users, riders and drivers — and the cross-side externality is asymmetric in its values, with the platform's strategic choices reflecting that asymmetry.
This sourceFoundational model of two-sided markets — cross-side externalities, asymmetric pricing, and the chicken-and-egg launch.
- A two-sided market specifies distinct sides whose roles in the transaction are not interchangeable — buyers and sellers, readers and advertisers, cardholders and merchants, developers and users, riders and drivers — and the cross-side externality is asymmetric in its values, with the platform's strategic choices reflecting that asymmetry.
- Winner Take All Market
- The competitors are rival platforms; the relevant quality dimension is match quality and wait time; but the convex payoff comes not from a prize schedule but from a network effect — each additional rider makes the larger platform more valuable to drivers (shorter idle time) and each additional driver makes it more valuable to riders (shorter waits).
This sourceFormalizes two-sided network externalities that produce concentrated, locked-in platform reward.
- The competitors are rival platforms; the relevant quality dimension is match quality and wait time; but the convex payoff comes not from a prize schedule but from a network effect — each additional rider makes the larger platform more valuable to drivers (shorter idle time) and each additional driver makes it more valuable to riders (shorter waits).
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