This volume consists of seven articles on the economics and regulation of interchange fees. All rely on the multi-sided platform framework. The first two chapters examine whether there is a market failure in setting interchange fees and present principles for considering correction to a market...

This Chapter provides a survey of the economics literature on multi-sided platforms with particular focus on competition policy issues, including market definition, mergers, monopolization, and coordinated behavior. It provides a survey of the general industrial organization theory of...

Government subsidies have driven rapid growth in U.S. wind and solar generation. Using data on hourly outputs and prices for 25 wind and nine solar generating plants, some results of those subsidies are studied in detail: the value of these plants' outputs, the variability of output at plant and...

The so-called “razor-and-blades” pricing strategy involves setting a low price for a durable basic product (razors) and a high price for a complementary consumable (blades). Oi (1971) showed that if consumers' demand curves differ and do not cross, a monopolist should always price blades...

Two decades have passed since the Clean Air Act Amendments of 1990 launched a grand experiment in market-based environmental policy: the SO2 cap-and-trade system. That system performed well but created four striking ironies. First, this system was put in place to curb acid rain, but the main...

This volume collects a series of essays that I have written over the last decade on multi-sided platform businesses that create value by providing products that enable two or more different types of customers to get together, find each other, and exchange value. Part I presents background pieces...

Software platforms are a critical component of the computer systems, underpinning leading-edge products ranging from third-generation mobile phones to video games. After describing some key economic features of computer systems and software platforms, the paper presents case studies of personal...

A surprising amount of debate leading up to the Supreme Court's decision in American Express, and the commentary following this landmark ruling, attempt to trivialize and marginalize the modern economic learning on multi-sided platforms. Despite these efforts the 2nd Circuit Court of Appeals and...

Currently, most U.S. electricity consumers pay a constant price per kWh consumed that accounts for most of their bill. Ongoing developments in the power system increase efficiency gains that can be made from exposing consumers to widely varying wholesale spot prices. Pure spot pricing is not...