Platform Contracting With Developers: Reconsiderung the "Control vs. Enable" Decision of Platforms from an Implementation Perspective

Anette Boom, Wolfgang Gick

Research output: Contribution to conferencePaperResearchpeer-review

Abstract

Platform intermediaries recur to the use of specific contractual forms when hiring developers. We study such contracts in a market model with a monopoly platform and a continuum of consumers and focus on multi-agent contracting under adverse selection on the developer side. Transfer discrimination between developers is possible but potentially limited. There is a development stage with ex-ante contracting. Two distinct types of implementation emerge: under Bayesian Implementation, higher information rents lead to more distortions. In turn, Dominant Strategy Implementation enables first-best production sharing under joint quality determination between the developers. As we bring two theoretical concepts to the analysis of two-sided platforms, our paper sheds new light on the nature of contractual relationships between a platform and multiple developers, so expanding the formal study of two-sided platforms beyond pricing.
Original languageEnglish
Publication date2018
Number of pages26
Publication statusPublished - 2018
EventAnnual Meeting of the Verein für Socialpolitik 2018: Digital Economy - University of Freiburg, Freiburg im Breisgau, Germany
Duration: 2 Sep 20185 Sep 2018
https://www.socialpolitik.de/De/jahrestagung-2018
https://www.eucken.de/veranstaltungen-s/vfs-2018/

Conference

ConferenceAnnual Meeting of the Verein für Socialpolitik 2018
LocationUniversity of Freiburg
CountryGermany
CityFreiburg im Breisgau
Period02/09/201805/09/2018
Internet address

Bibliographical note

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Keywords

  • Multi-agent contracting
  • Limited transfer discrimination
  • Bayesian vs. dominant strategy implementation
  • Ex-ante contracting
  • Information gathering

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