Estimating market power in a two-sided market: the case of newspapers

Elena Argentesi () and Lapo Filistrucchi ()

No ECO2005/07, Economics Working Papers from European University Institute

Abstract: The newspaper industry is a two-sided market: the readers market and the advertising market are closely linked by inter-market network externalities. We estimate market power in the Italian newspaper industry by building a structural model which encompasses a demand estimation for differentiated products on both sides of the market and where profit maximization by the publishing firms takes into account the interactions between them. The question that we address is whether the observed price pattern is consistent with profit-maximizing behavior by competing firms or is instead driven by some form of (tacit or explicit) coordinated practice.

Keywords: demand estimation; market power; two-sided markets; newspapers; differentiated products. (search for similar items in EconPapers)
JEL-codes: L11 L40 L82 C33 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-mic, nep-mkt and nep-net
Date: 2005
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Journal Article: Estimating market power in a two-sided market: The case of newspapers (2007)
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