From Win-Win to Winner-Take-All

55 Pages Posted: 20 Oct 2015 Last revised: 21 Apr 2016

See all articles by Chiu Yu Ko

Chiu Yu Ko

Chinese University of Hong Kong

Bo Shen

Wuhan University - School of Economics and Management

Date Written: April 21, 2016

Abstract

This paper studies when a two-sided market features win-win (market sharing), winner-take-most (market dominance) or winner-take-all (monopoly). While symmetric market structure is a natural result of competition among symmetric platforms, asymmetry also arises when network effects are strong. Market dominance and monopoly are always stable but market sharing is stable only if asymmetry cannot happen. We characterize a continuous transition pattern of stable market structures as network effects increase: from win-win, to winner-take-most, and finally to winner-take-all. From welfare perspective, winner-take-most and winner-take-all dominate win-win.

Keywords: Win-win; Winner-take-most, Winner-take-all, Market dominance, Two-sided markets, Stability, Multiple platforms

JEL Classification: D4, D43, L1

Suggested Citation

Ko, Chiu Yu and Shen, Bo, From Win-Win to Winner-Take-All (April 21, 2016). Available at SSRN: https://ssrn.com/abstract=2676452 or http://dx.doi.org/10.2139/ssrn.2676452

Chiu Yu Ko (Contact Author)

Chinese University of Hong Kong ( email )

Cheng Yu Tung Building
12 Chak Cheung Street
Shatin, N.T.
Hong Kong
39439799 (Phone)

HOME PAGE: http://https://www.bschool.cuhk.edu.hk/staff/ko-chiu-yu/

Bo Shen

Wuhan University - School of Economics and Management ( email )

Luojia Hill, Wuhan
Wu Han, Hu Bei 430072
China

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