We study optimal experimentation by a monopolistic platform in a two-sided market. The platform provider is uncertain about the strength of the externality each side is exerting on the other. Setting participation fees on both sides, it gradually learns about these externalities by observing...

We study optimal experimentation by a monopolistic platform in a two-sided market. The platform provider is uncertain about the strength of the externality each side is exerting on the other. Setting participation fees on both sides, it gradually learns about these externalities by observing...

This classroom experiment introduces students to the concept of double marginalization, i.e., the exercise of market power at successive vertical layers in a supply chain. By taking on roles of firms, students determine how the mark-ups are set at each successive production stage. They learn...

This article explains the supra-competitive profits observed in Calvano et al.(2020) and subsequent literature. We refute the idea that the phenomenon arises from collusive mechanisms, where each agent exerts the threat of punishment. Instead, our analysis reveals that the high prices and...

Recent theoretical models of network competition with call externalities demonstrate strategic incentives of incumbent providers to reduce receiver benefits in rival network by excessive off-net pricing. Such anti-competitive pricing practices have a potentially damaging impact on financial...