nep-net New Economics Papers
on Network Economics
Issue of 2007‒02‒03
three papers chosen by
Yi-Nung Yang
Chung Yuan Christian University
  1. Diversity and demand externalities: How cheap information can reduce welfare By Heski Bar-Isaac; Guillermo Caruana; Vicente Cunat
  2. Bargaining and posted prices: what does the Internet change ? By Michael A. Arnold (Dpt of Economics, U. Delaware); Thierry Pénard (CREM – CNRS)
  3. Exclusive Quality - Why Exclusive Distribution May Benefit the TV Viewers By Stennek, Johan
  1. By: Heski Bar-Isaac; Guillermo Caruana; Vicente Cunat
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:ste:nystbu:06-08&r=net
  2. By: Michael A. Arnold (Dpt of Economics, U. Delaware); Thierry Pénard (CREM – CNRS)
    Abstract: The Internet has introduced a variety of online buying services that expand the reach of sellers and reduce search costs for buyers. In markets in which traditional outlets tend to establish prices through bargaining, these online intermediaries have also altered the price setting process. Perhaps the most well known example is Autobytel.com which provides referral services in the automobile market. By using Autobytel, a buyer can obtain a posted price as an alternative to bargaining with a car dealer ship. To understand the effect of online referral systems on the price setting process, we construct a theoretical model of oligopolistic price competition in which one dealership has an exclusive contract with a referral intermediary. We show that posted prices offered through the referral system are not necessarily lower than offline prices (bargained prices). Our model provides theoretical insights relevant to results in the empirical literature addressing the role that Autobytel and other infomediaries play in online markets.
    Keywords: online markets, e-commerce, intermediary, autobytel, pricing
    JEL: D4 D83 L19 L89
    Date: 2007
    URL: http://d.repec.org/n?u=RePEc:tut:cremwp:200704&r=net
  3. By: Stennek, Johan
    Abstract: Sports organizations, Hollywood studios and TV channels grant satellite and cable networks exclusive rights to televise their matches, movies and media contents. Exclusive distribution prevents viewers from watching attractive programs, and reduces the TV-distributors incentives to compete in prices. This paper demonstrates that exclusive distribution may also give providers of contents incentives to invest in higher quality and, as a result, force competitors to reduce their prices. Exclusive distribution may benefit all viewers, including those who are excluded.
    Keywords: advertising; bargaining; exclusive contracts; investment; quality; two-sided market
    JEL: C78 D43 K21 L42
    Date: 2007–01
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:6072&r=net
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