“…While in physical two-sided markets such as shopping centers, fairs, and nightclubs space is physically limited, 2 this does not necessarily hold for digital two-sided market. However, advertising space is often restricted since too much advertising is often perceived as a nuisance by users and, therefore, decreasing the platform's value in the recipients' eyes (Becker and Murphy, 1993;Bagwell, 2007). In electronic two-sided market like online auction platforms or dating sites capacity limits can also emerge as a result of negative externalities caused by additional users.…”
Section: Concentration Levels In Two-sided-markets and Its Determinantsmentioning
Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The working papers published in the Series constitute work in progress circulated to stimulate discussion and critical comments. Views expressed represent exclusively the authors' own opinions and do not necessarily reflect those of the editor. Keywords: two-sided markets, online markets, digital economy, antitrust, e-commerce 1 We thank Paul Welfens and the participants of the workshop on "Digital EU-Integration and Globalisation" in Wuppertal for their very helpful comments and discussions.
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“…While in physical two-sided markets such as shopping centers, fairs, and nightclubs space is physically limited, 2 this does not necessarily hold for digital two-sided market. However, advertising space is often restricted since too much advertising is often perceived as a nuisance by users and, therefore, decreasing the platform's value in the recipients' eyes (Becker and Murphy, 1993;Bagwell, 2007). In electronic two-sided market like online auction platforms or dating sites capacity limits can also emerge as a result of negative externalities caused by additional users.…”
Section: Concentration Levels In Two-sided-markets and Its Determinantsmentioning
Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The working papers published in the Series constitute work in progress circulated to stimulate discussion and critical comments. Views expressed represent exclusively the authors' own opinions and do not necessarily reflect those of the editor. Keywords: two-sided markets, online markets, digital economy, antitrust, e-commerce 1 We thank Paul Welfens and the participants of the workshop on "Digital EU-Integration and Globalisation" in Wuppertal for their very helpful comments and discussions.
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“…In general, research on the economics of the supply of advertising services is scarce (Bagwell 2007). The only relevant study addressing governance issues theoretically and empirically is Horsky (2006).…”
This study investigates the extent to which U.S. advertisers use in-house rather than independent advertising agencies and examines inter-industry variation in such internalization. Contrary to the widely-held impression that use of an in-house advertising agency is more the exception than the rule, we find that vertical integration of advertising services is much more widespread than has hitherto been appreciated. Drawing on concepts from research on scale economies and transaction costs, we develop a set of hypotheses about differences in the expected depth of internalization across industries. We test these hypotheses in cross sectional analyses of data covering 69 two digit SIC industries at two points in time, 1991 and 1999. In both years, approximately half of advertisers of all sizes operated an in-house agency. Across industries, we find that the likelihood of internalization of at least some advertising services decreases as the size of advertising outlays increase but increases as advertising intensity and technological intensity increase and is greater for “creative” industries.
“…Consumers buy from the firm maximizing expected utility, i.e., consumers with θ < E(x|y 1 , y 2 ) buy design 1 and the rest design 2. If firm 1 doesn't advertise, its profit (net 5 For a survey of the different views on advertising see, e.g., Bagwell (2007).…”
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