Collusion Between Non-differentiated Two-Sided Platforms

Martin Peitz and Lily Samkharadze

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: Platform competition can be intense when offering non-differentiated services. However, competition is somewhat relaxed if platforms cannot set negative prices. If platforms collude they may be able to implement the outcome that maximizes industry profits. In an infinitely repeated game with perfect monitoring, this is feasible if the discount factor is sufficiently large. When this is not possible, under some condition, a collusive outcome with one-sided rent extraction along the equilibrium path can be sustained that leads to higher profits than the non-cooperative outcome.

Keywords: Two-sided markets; tacit collusion; cartelization; price structure; platform competition (search for similar items in EconPapers)
JEL-codes: D43 L13 L41 (search for similar items in EconPapers)
Pages: 20
Date: 2022-04
New Economics Papers: this item is included in nep-com, nep-gth, nep-mic, nep-pay and nep-reg
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Citations: View citations in EconPapers (2)

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Journal Article: Collusion between non-differentiated two-sided platforms (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2022_331v2

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