The Value of Incumbency When Platforms Face Heterogeneous Customers

• 成果类型: Article
• 署名作者: Biglaiser, Gary; Cremer, Jacques
• 署名单位: University of North Carolina; University of North Carolina Chapel Hill; Universite de Toulouse; Universite Toulouse 1 Capitole; Toulouse School of Economics
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20180225
• 发表日期: 2020
• 页码: 229-269
• 关键词: dynamic price-competition; compatibility; equilibrium; ECONOMICS; networks; adoption; MARKETS; entry

摘要

We study competition for the market in a dynamic model with network externalities, focusing on the efficiency of market outcomes. We propose a representation of the strategic advantages of incumbency and embed it in a dynamic framework with heterogeneous consumers. Then, we completely identify the conditions under which inefficient equilibria with several platforms emerge at equilibrium; explore the reasons why these inefficient equilibria arise; and compute the value of incumbency and analyze why static models generally exaggerate it.