Monopolistic Location Choice in Two-Sided Industries

Enrico Böhme and Christopher Müller

MPRA Paper from University Library of Munich, Germany

Abstract: We analyze the optimal location choice of a monopolistic firm that operates two platforms on a two-sided market. We show that the optimal platform locations are equivalent to the one-sided benchmark if both sides are either restricted to single- or multi-homing. In the mixed case (one side single-homes, the other one multi-homes), the optimal platform locations are determined by the relative profitability of both market sides. Our results indicate that modeling mergers on two-sided markets with fixed locations is often inappropriate.

Keywords: two-sided markets; location choice; monopoly; merger simulation (search for similar items in EconPapers)
JEL-codes: D42 K20 L12 L51 (search for similar items in EconPapers)
Date: 2012-10-05
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind, nep-law and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:41761

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