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Basic Pricing Principles in Two-Sided Markets: Some Simple Models

Aaron Schiff
University of Auckland - Department of Economics

August 29, 2007


Abstract:     
This paper illustrates basic pricing issues in two-sided markets using some simple linear models based on Rochet & Tirole (2006) and Armstrong (2006). Monopoly, first-best and second-best prices when a single platform charges either usage fees or membership fees are examined. Some implications for competition policy and regulation of two-sided markets are are also discussed.

Keywords: two-sided markets, platforms, pricing

JEL Classifications: L11, L12

Working Paper Series

Date posted: August 29, 2007 ; Last revised: August 29, 2007

Suggested Citation

Schiff, Aaron, Basic Pricing Principles in Two-Sided Markets: Some Simple Models (August 29, 2007). Available at SSRN: http://ssrn.com/abstract=1010553


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Contact Information

Aaron Schiff (Contact Author)
University of Auckland - Department of Economics ( email )
Private Bag 92019
Auckland New Zealand
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References: 8

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