{"title":"Welfare Effects of Platforms’ Exclusivity Clauses","authors":"Marit Holler","doi":"10.1515/rne-2023-0014","DOIUrl":null,"url":null,"abstract":"Abstract Buyers are often active on multiple digital platforms, while gatekeeper platforms can force sellers contractually to use one platform exclusively. This paper considers the welfare effects of such exclusivity clauses for buyers, sellers and platforms in a platform duopoly with a seller membership fee. A setting with partially multihoming buyers and sellers is compared to one with partially multihoming buyers and singlehoming sellers. It is shown that exclusivity clauses predominately harm total welfare. Buyers suffer if sellers are exclusive on one platform, while platforms and sellers benefit from exclusivity clauses under certain conditions. In an environment with exclusivity clauses, when strong cross-group benefits and weak platform differentiation result in fierce price competition, exclusivity clauses can be welfare-enhancing.","PeriodicalId":45659,"journal":{"name":"Review of Network Economics","volume":"42 1","pages":""},"PeriodicalIF":0.9000,"publicationDate":"2023-09-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Review of Network Economics","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1515/rne-2023-0014","RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"ECONOMICS","Score":null,"Total":0}
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Abstract
Abstract Buyers are often active on multiple digital platforms, while gatekeeper platforms can force sellers contractually to use one platform exclusively. This paper considers the welfare effects of such exclusivity clauses for buyers, sellers and platforms in a platform duopoly with a seller membership fee. A setting with partially multihoming buyers and sellers is compared to one with partially multihoming buyers and singlehoming sellers. It is shown that exclusivity clauses predominately harm total welfare. Buyers suffer if sellers are exclusive on one platform, while platforms and sellers benefit from exclusivity clauses under certain conditions. In an environment with exclusivity clauses, when strong cross-group benefits and weak platform differentiation result in fierce price competition, exclusivity clauses can be welfare-enhancing.
期刊介绍：
The Review of Network Economics seeks to help policy makers, academics, and practitioners keep informed of new research and policy debate in network economics and related subjects that are relevant to the study of network industries. By publishing high quality research on topical issues relevant to network industries, it is hoped readers will be able to gain a deeper understanding of the economic issues involved and that this will improve the quality of decision making by private and public organisations, and debate among researchers. The articles can cover specific network industries, or may deal with general issues that have relevance to a number of different network industries, including topics in the economics of networks, regulation, competition law, or industrial organisation. Papers that provide insights into policy debates are especially welcome, as are up-to-date surveys, book reviews, and comments.
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