In this paper, we develop an economic rationale for the following stylized fact: Web‐based firms spend profligately on advertising and marketing and usually lose money. Our rationale is based on the winner‐take‐all structure of high fixed cost, low marginal cost, markets for information...

In this paper, we develop an economic rationale for the following stylized fact: Web-based firms spend profligately on advertising and marketing and usually lose money. Our rationale is based on the winner-take-all structure of high fixed cost, low marginal cost, markets for information goods....

Electricity market design in the United States is increasingly dominated by locational marginal pricing (LMP) of energy and transmission. LMP markets are typically coupled with periodic auctions of financial transmission rights (FTRs) to hedge transmission price risks. While LMP designs offer...