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The Role of Quantitative and Qualitative Network Effects in B2B Platform Competition

Zhiwen Li () and Thierry Pénard ()
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Zhiwen Li: School of management Jiangsu University - JiangSu University

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Abstract: This article aims at investigating how quantitative and qualitative (indirect) network effects impact pricing and trading decisions on a Business-to-Business marketplace. Using an original data set collected on MFG.com, one of the most prominent B2B platforms in the U.S.A., we find that the market share of a marketplace depends on both the quantity and quality of suppliers, but that quality effects tend to substitute for quantity effects as the size of the marketplace increases. These results suggest that while the quantity of suppliers on board is crucial during the early stage of a marketplace, supplier quality matters much more in the mature stage.

Keywords: network; b2b platform (search for similar items in EconPapers)
Date: 2013
Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00869881
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Published in Managerial and Decision Economics, Wiley, 2013, 35 (1), pp.1-19. 〈10.1002/mde.2602〉

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00869881

DOI: 10.1002/mde.2602

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