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on Network Economics |
| By: | Aija Leiponen |
| Keywords: | standard setting, wireless telecommunication, cooperative arrangements |
| Date: | 2005–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:rif:dpaper:997&r=net |
| By: | Andras Niedermayer |
| Abstract: | We consider a software vendor selling both a monopoly platform (e.g. operating system) and an application that runs on this platform. He may face competition by an entrant in the applications market. Consumers are heterogeneous in their preferences for both the platform and the applications. They first buy the platform and then the applications. Their utility over the horizontally differentiated applications is known only after they bought the platform. In equilibrium the platform seller can be better off with a competitor in the applications market for three reasons. First, the platform vendor makes more profits with his platform. Second, the competitor’s entry serves as a credible commitment to lower prices for applications. Third, higher ex ante expectations of product diversity lead to a higher demand for his application. Competition may be profit enhancing even if the first two effects are absent, i.e. the product diversity effect can be sufficient. The model also gives an answer to the much debated question why Microsoft prices MS Office significantly higher than its operating system. |
| Keywords: | Two-sided markets; platforms; entry; complementary goods; price commitment; product diversity; Microsoft |
| JEL: | D41 D43 L13 L86 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:ube:dpvwib:dp0517&r=net |
| By: | Toolsema, Linda (Groningen University) |
| Abstract: | In April 2004, the European Union adopted a new legislative framework for genetically modified (GM) organisms. This framework regulates the placing on the market of GM products, and demands these products to be labeled as such. We present a duopoly model with vertical differentiation and mandatory labeling, where one firm produces the conventional product. We assume the GM product to have lower marginal cost, and lower value to consumers. We analyze the effects of introducing the GM good on output, prices, and welfare. We also study contamination and costly testing of convential goods. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:rugsom:05c12&r=net |
| By: | Müge Ozman |
| Abstract: | In this paper, we highlight how inter-firm collaboration networks are influenced by the knowledge composition of goods in an industry. For this purpose, we carry out an agent based simulation study in which firms integrate their competencies under different knowledge base regimes. In this way networks form. The results reveal that, knowledge regime significantly influences the network structure, and interaction among firms is very intensive when the products are specialized but also have common knowledge among them. |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2006-06&r=net |