Measuring Markets for Network Goods

Leonardo Bursztyn (), Matthew Gentzkow (), Rafael Jiménez-Durán (), Aaron Leonard (), Filip Milojević () and Christopher Roth ()
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Leonardo Bursztyn: University of Chicago & NBER
Matthew Gentzkow: Stanford University & NBER
Rafael Jiménez-Durán: Bocconi University, IGIER, CESifo, & Chicago Booth Stigler Center
Filip Milojević: University of Chicago
Christopher Roth: University of Cologne, NHH Norwegian School of Economics, Max Planck Institute for Research on Collective Goods, CESifo, & CEPR

No 363, ECONtribute Discussion Papers Series from University of Bonn and University of Cologne, Germany

Abstract: Market definition is essential for antitrust analysis, but challenging in settings with network effects, where substitution patterns depend on changes in network size. To address this challenge, we conduct an incentivized experiment to measure substitution patterns for TikTok, a popular social media platform. Our experiment, conducted during a time of high uncertainty about a potential U.S. TikTok ban, compares changes in the valuation of other social apps under individual and collective TikTok deactivations. Consistent with a simple framework, the valuations of alternative social apps increase more in response to a collective TikTok ban than to an individual TikTok deactivation. Our framework and estimates highlight that individual and collective treatments can even lead to qualitatively different conclusions about which alternative goods are substitutes.

Keywords: Markets; Network Goods; Coordination; Collective Interventions (search for similar items in EconPapers)
JEL-codes: D83 D91 J15 P16 (search for similar items in EconPapers)
Pages: 62 pages
Date: 2025-05
New Economics Papers: this item is included in nep-exp, nep-pay, nep-reg and nep-soc
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Persistent link: https://EconPapers.repec.org/RePEc:ajk:ajkdps:363

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