Abstract

http://ssrn.com/abstract=1657630
 
 

Citations (3)



 


 



Competition in Two-Sided Markets: The Antitrust Economics of Payment Card Interchange Fees


Andres V. Lerner


Compass Lexecon

Kevin M. Murphy


University of Chicago; National Bureau of Economic Research (NBER)

Lacey Plache


Navigant Consulting, Inc. - LECG

Benjamin Klein


University of California, Los Angeles (UCLA) - Department of Economics

2006

Antitrust Law Journal, Vol. 73, No. 3, 2006

Abstract:     
Standard economics provides a well-understood framework of the competitive determinants of market prices that is now widely accepted for antitrust analysis. In “two-sidedmarkets,” where firms supply products demanded by two interrelated groups of consumers, these competitive forces operate in a somewhat more complex way and understanding the antitrust implications requires extending the standard framework. For example, a newspaper publisher faces demand from both readers and advertisers. The publisher must balance demand on the two sides of the market in determining two interrelated sets of prices, taking account of the fact that lowering subscription prices and thereby increasing readership will increase advertising prices. These “network effects” of increased readership on advertising value are what make the economic analysis unique and the antitrust implications somewhat unfamiliar.

Number of Pages in PDF File: 56

JEL Classification: L10, K21

Accepted Paper Series


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Date posted: July 9, 2011  

Suggested Citation

Lerner, Andres V. and Murphy, Kevin M. and Plache, Lacey and Klein, Benjamin, Competition in Two-Sided Markets: The Antitrust Economics of Payment Card Interchange Fees (2006). Antitrust Law Journal, Vol. 73, No. 3, 2006. Available at SSRN: http://ssrn.com/abstract=1657630

Contact Information

Andres V. Lerner
Compass Lexecon ( email )
1999 Avenue of the Stars
Suite 2500
Los Angeles, CA 90067-6028
United States
310-728-2026 (Phone)
310-728-2070 (Fax)
HOME PAGE: http://www.compasslexecon.com/professionals/pages/bio.aspx?ID=155
Kevin M. Murphy
University of Chicago ( email )
5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-7280 (Phone)
773-702-2699 (Fax)
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Lacey Plache
Navigant Consulting, Inc. - LECG ( email )
1603 Orrington
Suite 1500
Evanston, IL 60201
United States
Benjamin Klein (Contact Author)
University of California, Los Angeles (UCLA) - Department of Economics ( email )
1999 Avenue of the Stars
Suite 2500
Los Angeles, CA 90067-6028
United States
310-728-2025 (Phone)
310-728-2070 (Fax)
HOME PAGE: http://www.econ.ucla.edu/people/Faculty/Klein.html
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