Effects of the internet on firm business mode: platform economies
| Authors | Methodology/theory | Main results |
|---|---|---|
| Rochet and Tirole (2006) | Building a model encompassing internet usage and membership externalities | Make the definition of two‐sided markets Price structure is a determinant in two‐sided markets Price principle is replacing “cost” by “opportunity cost” |
| Haucap and Heimeshoff (2014) | Competition theory | The leading internet platforms, such as Google and Facebook, have non-temporary market power Policymakers would still need not to make market regulation |
| Dinerstein et al. (2018) | Consumer search and price competition theory | Homogeneous impact on product categories and short-and longer-run effects of eBay’s platform eBay’s platform design is effective on a narrow, yet well-defined product category |
| Qu et al. (2013) | Bilateral market theory; and network externality | Service price of platform firm depends on network externality The impact of network externality can be reduced through connectivity and modular operation |
| Sun et al. (2017) | NEIO method | Internet platform firms do not have obvious market power The large internet platform firm may not cause welfare losses of consumers |
| Su et al. (2018) | Monopoly competitive advantage theory | The market structure of internet platform firm presented the characteristics of “hierarchical monopolistic competition” Monopoly exists in large firms, while competition exists in small and medium-sized enterprises |
| Wang et al. (2019) | Building a sorting mechanism model | Sorting mechanism can effectively solve some product quality problems in Taobao Different sequencing methods have different influences on firm quality choice |
| Authors | Methodology/theory | Main results |
|---|---|---|
| Building a model encompassing internet usage and membership externalities | Make the definition of two‐sided markets | |
| Competition theory | The leading internet platforms, such as Google and Facebook, have non-temporary market power | |
| Consumer search and price competition theory | Homogeneous impact on product categories and short-and longer-run effects of eBay’s platform | |
| Bilateral market theory; and network externality | Service price of platform firm depends on network externality | |
| NEIO method | Internet platform firms do not have obvious market power | |
| Monopoly competitive advantage theory | The market structure of internet platform firm presented the characteristics of “hierarchical monopolistic competition” | |
| Building a sorting mechanism model | Sorting mechanism can effectively solve some product quality problems in Taobao |