Open Access as a Crude Solution to a Hold-Up Problem in the Two-Sided Market for Academic Journals

42 Pages Posted: 9 May 2016 Last revised: 19 Sep 2021

See all articles by Mark J. McCabe

Mark J. McCabe

Boston University - Questrom School of Business; SKEMA Business School, Université Côte d’Azur (GREDEG), Sophia Antipolis, France

Christopher M. Snyder

Dartmouth College - Department of Economics; National Bureau of Economic Research

Multiple version iconThere are 2 versions of this paper

Date Written: May 2016

Abstract

The move from traditional to open-access journals—which charge no subscription fees, only submission fees—is gaining support in academia. We analyze a two-sided-market model in which journals cannot commit to subscription fees when authors (who prefer low subscription fees because this boosts readership) make submission decisions. This leads to a hold-up problem, manifested as excessive subscription fees. Open access is a crude attempt to avoid hold up by eliminating subscription fees. We compare the efficiency and profitability of traditional versus open access under various market structures (monopoly, Bertrand competition) and extensions (non-profit journals, bundling, hybrid pricing), using our theoretical findings to understand the evolution of the market for academic journals in the Internet age.

Suggested Citation

McCabe, Mark J. and Snyder, Christopher M., Open Access as a Crude Solution to a Hold-Up Problem in the Two-Sided Market for Academic Journals (May 2016). NBER Working Paper No. w22220, Available at SSRN: https://ssrn.com/abstract=2777308

Mark J. McCabe (Contact Author)

Boston University - Questrom School of Business ( email )

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SKEMA Business School, Université Côte d’Azur (GREDEG), Sophia Antipolis, France ( email )

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SKEMA Business School, Economics Department
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France

HOME PAGE: http://sites.google.com/site/markjmccabe1/home

Christopher M. Snyder

Dartmouth College - Department of Economics ( email )

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(603) 646-2122 (Fax)

HOME PAGE: http://www.dartmouth.edu/~csnyder/

National Bureau of Economic Research ( email )

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