Abstract
A monopoly integrator platform contracts with two developers and sells to acontinuum of consumers. We study two contractual implementation modes betweenthe platform and the developers under adverse selection, also permitting for a d-velopment stage. Exemplifying a new “openness-versus-control” trade-off, Bayesianimplementation leads to more distortions in equilibrium. The alternative, more opencontracting mode of Pareto-dominant strategy implementation, not yet studied in aplatform context, enables more first-best outcomes under joint quality determinationand higher expected consumer surplus. Our analysis delivers a new explanation forplatform-based organizational choices.
| Original language | English |
|---|---|
| Publication date | 2019 |
| Number of pages | 33 |
| Publication status | Published - 2019 |
| Event | 46th Annual Conference of the European Association for Research in Industrial Economics. EARIE 2019 - Ciutadella of the Universitat Pompeu Fabra, Barcelona, Spain Duration: 30 Aug 2019 → 1 Sept 2019 Conference number: 46 https://www.barcelonagse.eu/earie2019 |
Conference
| Conference | 46th Annual Conference of the European Association for Research in Industrial Economics. EARIE 2019 |
|---|---|
| Number | 46 |
| Location | Ciutadella of the Universitat Pompeu Fabra |
| Country/Territory | Spain |
| City | Barcelona |
| Period | 30/08/2019 → 01/09/2019 |
| Internet address |
Keywords
- Platform organization
- Openness vs. control
- Quality and component development
- areto-dominant strategy implementation vs. Bayesian implementation