A Novel Argument on Regulating Prices in Two-sided Markets : Finding Win-Win Policy Correctly

Nishimura, Yukihiro

A Novel Argument on Regulating Prices in Two-sided Markets : Finding Win-Win Policy Correctly

Nishimura, Yukihiro

Discussion Papers In Economics And Business, 2025, 25-05

Number of Access:30（2025-08-16 00:37 Counts）

Identifier to cite or link to this item: https://hdl.handle.net/11094/102343

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Title	A Novel Argument on Regulating Prices in Two-sided Markets : Finding Win-Win Policy Correctly
Creator	NRID 1000090345471 1000090345471 researchmap permalink read0156474 read0156474 Scopus Author ID 7403347968 7403347968 CreatorName Nishimura, Yukihiro
Subject	Digital economy
	Platform
	Antitrust pricing
	Network externality
JEL	F23
	L13
	D85
	K21
	L86
Abstract	Online markets like app stores are typically characterized by a monopoly who set prices on both sides — the prices of the network good (such as iPhone) and the commission fee to participating firms. There is an ongoing concerns on the welfare consequences of imperfect competition, where the antitrust authorities in the EU are keen about the monopolistic commission fee. With online apps as a representative example, this study investigates the welfare effects of price ceiling policies. The following results are shown. If the network-size externality on apps’ price is stronger than the app variety’s network externality, then, first, the price ceiling on the network good increases both the producer surplus of the app developers and the consumer surplus of the end-users. Second, in contrast, the price ceiling on the commission fee for the developers reduces the consumer surplus. The reverse proposition holds when the order of the strength of two network externalities is reversed. By the level of the unconstrained equilibrium commission fee, a regulator can identify which policy would make both consumers and developers better off.
Publisher	Graduate School of Economics, The University of Osaka
Source Title	Discussion Papers In Economics And Business
Volume (Issue)	25-05
Date of Issued	2025-07
Language	English
Handle URL	https://hdl.handle.net/11094/102343
Relation.references	URI https://www2.econ.osaka-u.ac.jp/econ_society/dp/2505.pdf
Access Rights	metadata only access
Category	ディスカッション／ワーキング・ペーパー DP/WP
Category	Discussion Papers In Economics And Business

Resource Type	technical report
Local Type	DP/WP
DCMI Type	Text
DCTERMS.bibliographicCitation	Discussion Papers In Economics And Business. 2025, 25-05
DC.title	A Novel Argument on Regulating Prices in Two-sided Markets : Finding Win-Win Policy Correctly
DC.creator	Nishimura, Yukihiro
DC.publisher	Graduate School of Economics, The University of Osaka
DC.language' scheme='DCTERMS.RFC1766	English
DC.type' scheme='DCTERMS.DCMIType	Text
DCTERMS.issued' scheme='DCTERMS.W3CDTF	2025-07
DC.relation' scheme='DCTERMS.URI	https://www2.econ.osaka-u.ac.jp/econ_society/dp/2505.pdf
DC.subject	Digital economy
	Platform
	Antitrust pricing
	Network externality
DCTERMS.abstract	Online markets like app stores are typically characterized by a monopoly who set prices on both sides — the prices of the network good (such as iPhone) and the commission fee to participating firms. There is an ongoing concerns on the welfare consequences of imperfect competition, where the antitrust authorities in the EU are keen about the monopolistic commission fee. With online apps as a representative example, this study investigates the welfare effects of price ceiling policies. The following results are shown. If the network-size externality on apps’ price is stronger than the app variety’s network externality, then, first, the price ceiling on the network good increases both the producer surplus of the app developers and the consumer surplus of the end-users. Second, in contrast, the price ceiling on the commission fee for the developers reduces the consumer surplus. The reverse proposition holds when the order of the strength of two network externalities is reversed. By the level of the unconstrained equilibrium commission fee, a regulator can identify which policy would make both consumers and developers better off.
DC.format	102343
citation_title	A Novel Argument on Regulating Prices in Two-sided Markets : Finding Win-Win Policy Correctly
citation_author	Nishimura, Yukihiro
citation_publisher	Graduate School of Economics, The University of Osaka
citation_language	English
citation_date	2025-07
citation_journal_title	Discussion Papers In Economics And Business
citation_volume	25-05
citation_public_url	https://hdl.handle.net/11094/102343
citation_abstract_html_url	https://www2.econ.osaka-u.ac.jp/econ_society/dp/2505.pdf

A Novel Argument on Regulating Prices in Two-sided Markets : Finding Win-Win Policy Correctly

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