Strategic Models of Intermediation Networks

Condorelli, Daniele; Galeotti, Andrea

doi:10.1093/oxfordhb/9780199948277.013.16

Cited by 10 publications

(3 citation statements)

References 36 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Muto (1986) and Takeyama (1994) analyze the consequences of consumption externalities for the pricing of information goods in a complete network, and Polanski (2019) provides a treatment for general networks with a focus on link formation and an application to citation graphs. This paper contributes to the growing literature on intermediation and bargaining power in networks (Condorelli and Galeotti 2016, Manea 2016), which has focused on the trade of nonreplicable goods so far.…”

Section: Introductionmentioning

confidence: 99%

Bottleneck links, essential intermediaries, and competing paths of diffusion in networks

Manea

2021

View full text Add to dashboard Cite

We investigate how information goods are priced and diffused over links in a network. A new equivalence relation between nodes captures the effects of network architecture and locations of sellers on the division of profits, and characterizes the topology of competing (and potentially overlapping) diffusion paths. Sellers indirectly appropriate profits over intermediation chains from buyers in their equivalence classes. Links within the same class constitute bottlenecks for information diffusion and confer monopoly power. Links that bridge distinct classes are redundant for diffusion and generate competition among sellers. In dense networks, competition limits the scope of indirect appropriability and intellectual property rights foster innovation.

show abstract

Section: Introductionmentioning

confidence: 99%

Bottleneck links, essential intermediaries, and competing paths of diffusion in networks

Manea

2021

View full text Add to dashboard Cite

show abstract

“…There is a long tradition of research on power and exchange in networks; prominent contributions include ( 7 , 12 – 29 ). Building on this research, a recent literature in computer science and economics examines how surpluses and market power emerge through the deliberate creation of links in a network formation setting ( 5 , 30 – 35 ); for an overview of this research, see ref. 4 .…”

mentioning

confidence: 99%

Brokerage rents and intermediation networks

Choi

Goyal

Moisan

2023

Proc. Natl. Acad. Sci. U.S.A.

View full text Add to dashboard Cite

This paper provides experimental evidence on the economic determinants of intermediation networks by considering two pricing rules—respectively, criticality and betweenness—and three group sizes of subjects—10, 50, and 100 subjects. We find that when brokerage benefits accrue only to traders who lie on all paths of intermediation, stable networks involve interconnected cycles, and trading path lengths grow while linking and payoff inequality remain modest as the number of traders grows. By contrast, when brokerage benefits are equally distributed among traders on the shortest paths, stable networks contain a few hubs that provide the vast majority of links, and trading path lengths remain unchanged while linking and payoff inequality explode as the number of traders grows.

show abstract

“…Malamud and Rostek (2017) and Babus and Condor (2018) study asset trading in networks. For a survey on intermediation and resale in networks see Condorelli and Galeotti (2016).…”

mentioning

confidence: 99%

The role of networks in antitrust investigations

Elliott

Galeotti

2019

Oxford Review of Economic Policy

Self Cite

View full text Add to dashboard Cite

Antitrust investigations typically focus on the competitive pressures coming from within the defined markets of interest. However, competitive pressures can also come from other markets. Even when individually these markets place only weak constraints on one another, collectively they may matter. A networks approach to modelling competition permits a systemic view of competition that can sometimes paint a more accurate picture. We demonstrate this through some simple examples, and show more generally how tools from the networks literature can be applied to capture competition across a system of interrelated markets. As a leading example, we consider antitrust investigations into supermarkets where local geographic markets have been used as the basis of investigation.

show abstract

Strategic Models of Intermediation Networks

Cited by 10 publications

References 36 publications

Bottleneck links, essential intermediaries, and competing paths of diffusion in networks

Bottleneck links, essential intermediaries, and competing paths of diffusion in networks

Brokerage rents and intermediation networks

The role of networks in antitrust investigations

Contact Info

Product

Resources

About