Platform MFN Clauses and Complementary Services

Jong-Hee Hahn and Seongkyun Kim
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Jong-Hee Hahn: Yonsei University
Seongkyun Kim: Software Policy & Research Institute

No 2026rwp-281, Working papers from Yonsei University, Yonsei Economics Research Institute

Abstract: This paper examines the welfare effects of most-favored-nation (MFN) clauses in markets where platforms not only act as intermediaries but also compete to offer auxiliary services such as delivery. Analyzing a linear demand model in which platforms set both transaction and service fees, we show that although MFNs intensify competition for service fees, their tendency to elevate transaction fees dominates, reducing aggregate transaction volume and thereby diminishing consumer surplus and overall welfare. This result holds for asymmetric platforms, provided all remain active in the market, and is robust to changes in the intensity of platform competition.

Keywords: Online platform; MFNs; Price parity; Antitrust; Service competition (search for similar items in EconPapers)
JEL-codes: D4 D8 L1 L4 (search for similar items in EconPapers)
Pages: 26pages
Date: 2026-02
New Economics Papers: this item is included in nep-com, nep-mic and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:yon:wpaper:2026rwp-281

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