Platform Governance
Year: 2019
Type: article
Abstract: Platforms that intermediate trades—such as Amazon, Airbnb, and eBay—play a regulatory role in deciding how to govern the marketplaces they create. We propose a framework to analyze a platform’s nonprice governance design and its incentive to act in a welfare-enhancing manner. We show that the platform’s governance design can be distorted toward inducing insufficient or excessive seller competition, depending on the nature of the fee instrument employed by the platform. These results are illustrated with micro-founded applications to a platform’s control over seller entry, information provision and recommendations, quality standards, and search-design choices. (JEL D21, D83, L15, L23, L81, M37)
DOI: 10.1257/mic.20190307
Author: Tat-How Teh
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W4288032980