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Full-Text Articles in Business Administration, Management, and Operations

Competing By Restricting Choice: The Case Of Search Platforms, Hanna Halaburda, Mikolaj Jan Piskorski, Pinar Yildirim Dec 2017

Competing By Restricting Choice: The Case Of Search Platforms, Hanna Halaburda, Mikolaj Jan Piskorski, Pinar Yildirim

Hanna Halaburda

We show that a two-sided platform can successfully compete by limiting the choice of potential matches it offers to its customers while charging higher prices than platforms with unrestricted choice. Starting from micro-foundations, we derive the strength and direction of network effect, and find that increasing the number of potential matches not only has a positive effect due to larger choice, but also a negative effect due to competition between agents on the same side. Agents with heterogeneous outside options resolve the trade-off between the two effects differently. For agents with a lower outside option, the competitive effect is stronger …


The Role Of Coordination Bias In Platform Competition, Hanna Halaburda, Yaron Yehezkel Dec 2015

The Role Of Coordination Bias In Platform Competition, Hanna Halaburda, Yaron Yehezkel

Hanna Halaburda

This paper considers platform competition in a two-sided market that includes buyers and sellers. One of the platforms benefits from a favorable coordination bias in the market, in that for this platform it is less costly than for the other platform to convince customers that the two sides will coordinate on joining it. We find that the degree of the coordination bias affects the platform's decision regarding the business model (i.e., whether to subsidize buyers or sellers), the access fees and the size of the platform. A slight increase in the coordination bias may induce the advantaged platform to switch …


All-Units Discounts As A Partial Foreclosure Device, Yong Chao, Guofu Tan Dec 2014

All-Units Discounts As A Partial Foreclosure Device, Yong Chao, Guofu Tan

Yong Chao

All-units discounts (AUD) are pricing schemes that lower a buyer’s marginal price on every unit purchased when the buyer’s purchase exceeds or is equal to a pre-specified threshold. The AUD and related conditional rebates are commonly used in both final-goods and intermediate-goods markets. Although the existing literature has thus far focused on interpreting the AUD as a price discrimination tool, investment incentive program, or rent-shifting instrument, the antitrust concerns on the AUD and related conditional rebates are often their plausible exclusionary effects.

In this article, we investigate strategic effects of volume-threshold based AUD used by a dominant firm in the …


Information And Two-Sided Platform Profits Apr 2014

Information And Two-Sided Platform Profits

Hanna Halaburda

We study the effect of different levels of information on two-sided platform profits--under monopoly and competition. One side (developers) is always informed about all prices and therefore forms responsive expectations. In contrast, we allow the other side (users) to be uninformed about prices charged to developers and to hold passive expectations. We show that platforms with more market power (monopoly) prefer facing more informed users. In contrast, platforms with less market power (i.e., facing more intense competition) have the opposite preference: they derive higher profits when users are less informed. The main reason is that price information leads user expectations …


Corrigendum To "Improving Bid Efficiency For Humanitarian Food Aid Procurement": [Int. J. Production Economics 134 (2011) 238–245], Aniruddha Bagchi, Jomon Aliyas Paul, Michael Maloni Apr 2014

Corrigendum To "Improving Bid Efficiency For Humanitarian Food Aid Procurement": [Int. J. Production Economics 134 (2011) 238–245], Aniruddha Bagchi, Jomon Aliyas Paul, Michael Maloni

Jomon Aliyas Paul

Correction: Few of the equations and formulas in the above mentioned article has been produced incorrectly. The correct equations as per the original source are provided.


Location-Allocation Planning Of Stockpiles For Effective Disaster Mitigation, Jomon Aliyas Paul, Govind Hariharan Apr 2014

Location-Allocation Planning Of Stockpiles For Effective Disaster Mitigation, Jomon Aliyas Paul, Govind Hariharan

Jomon Aliyas Paul

In the existing framework for receiving and allocating Strategic National Stockpile (SNS) assistance, there are three noticeable delays: the delay by the state in requesting federal assets, the delay in the federal process which releases assets only upon the declaration of a disaster and lastly the time it takes to reach supplies rapidly from the SNS stockpile to where it is needed. The most efficient disaster preparedness plan is one that addresses all three delays taking into account the unique nature of each disaster. In this paper, we propose appropriate changes to the existing framework to address the first two …


When Does A Platform Create Value By Limiting Choice?, Ramon Casadesus-Masanell, Hanna Halaburda Dec 2013

When Does A Platform Create Value By Limiting Choice?, Ramon Casadesus-Masanell, Hanna Halaburda

Hanna Halaburda

We present a theory for why it might be rational for a platform to limit the number of applications available on it. Our model is based on the observation that even if users prefer application variety, applications often also exhibit direct network effects. When there are direct network effects, users prefer to consume the same applications to benefit from consumption complementarities. We show that the combination of preference for variety and consumption complementarities gives rise to (i) a commons problem (to better satisfy their individual preference for variety, users have an incentive to consume more applications than the number that …


Strategic Effects Of Three-Part Tariffs Under Oligopoly, Yong Chao Jul 2013

Strategic Effects Of Three-Part Tariffs Under Oligopoly, Yong Chao

Yong Chao

The distinct element of a three-part tariff, compared with linear pricing or a two-part tariff, is its quantity target within which the marginal price is zero. This quantity target instrument enriches the firm's strategy set in dictating the competition to a specific level, even in the absence of usual price discrimination motive. With general differentiated linear demand system, the competitive effect of a three-part tariff in contrast to linear pricing depends on the degree of substitutability between products: competition is intensified when two products are more differentiated, yet softened when two products are more substitutable.


Empires Of The Mind: Cross Cultural Cooperative Business Education, Keith Duncan, Simone Kelly, Raymond Mcnamara Oct 2012

Empires Of The Mind: Cross Cultural Cooperative Business Education, Keith Duncan, Simone Kelly, Raymond Mcnamara

Keith Duncan

This paper explores current trends in knowledge growth and decay, globalization, technology and education. Business education in the new millennium is shaped by these trends. This contextual backdrop raises both educational and business issues which are explored with exemplars from a successful cross-cultural blended MBA program. The educational issues considered include educational relevance, lifelong learning objectives, education vs. training, needs of the target audience, what is the language of instruction, as well as issues of assessment and outcome measurement. The business issues include a fair return to all parties, responsibilities, management and communication systems and dispute resolution. In a globalized, …


Can We Believe In Cold Showers?, Neil Campbell Feb 1998

Can We Believe In Cold Showers?, Neil Campbell

Neil Campbell

This paper considers the case of a firm which faces the decision as to whether to invest in a cost-reducing technology with an uncertain return. Under certain conditions the removal of protection can facilitate this investment (a 'cold shower'). It is shown, in the case of Cournot competition, that a cold shower is more likely if a quota rather than a tariff is the protective instrument. It is also shown that a cold shower is more likely if the domestic firm is a Stackelberg leader rather than a Cournot competitior. A Cournot market structure is used to consider a reduction …