Cited by 235Digital Platforms and EconomicsBusiness Strategy and InnovationAuction Theory and Applications

Design and Ownership of Two-Sided Networks: Implications for Internet Platforms

Bakos, Yannis, Katsamakas, Evangelos·2008·Journal of Management Information Systems

Abstract

Many Internet intermediaries operate two-sided networks, that is, they provide platforms to bring together two types of participants, or "sides," such as buyers and sellers. This paper develops a model that characterizes the intermediary's pricing in two-sided networks, the value created by these networks, and the allocation of that value across the two sides. It extends the two-sided networks literature by endogenizing the level of network effects as the result of relevant investments by the intermediary, which determine the design of the network. It shows that under certain assumptions about the available technologies, the design of the two-sided network is highly asymmetric independent of its ownership structure. The paper provides insight into design strategies for Internet platforms, and it discusses their welfare implications.

Integrity signals

Registry

Crossref · 10.2753/mis0742-1222250208

Cites

39 of 39 references verified0 citation errors · 0 not checkable

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Claims other papers make about this one

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  • Ownership decisions affect both the distribution of power and the relationships between actors in the ecosystem, leading to a vertical, horizontal, or modular system.

    “Ownership decisions affect both the distribution of power and the relationships between actors in the ecosystem, leading to a vertical, horizontal, or modular system.”

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Authors
Bakos, Y., & Katsamakas, E.
Affiliations
  • New York University (US)
  • Fordham University (US)
Venue
Journal of Management Information Systems
Published
2008-09
Volume
25
Issue
2
Pages
171-202
ISSN
  • 0742-1222 (ISSN-L)
  • 1557-928X
OpenAlex
W1978978112
Cited by
235
References
41
Citations by year
2026: 3 · 2025: 5 · 2024: 18 · 2023: 20 · 2022: 25 · 2021: 23 · 2020: 23 · 2019: 24 · 2018: 14 · 2017: 4 · 2016: 11 · 2015: 9 · 2014: 13 · 2013: 7 · 2012: 13
FWCI
23.35
Type
journal article
Language
en
Open access
closed
Locations
Journal of Management Information Systems (publishedVersion)
Topics
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Digital Platforms and Economics
  • Social Sciences › Business, Management and Accounting › Strategy and Management › Business Strategy and Innovation
  • Social Sciences › Decision Sciences › Management Science and Operations Research › Auction Theory and Applications
Keywords
digital platforms, platform design, platform ownership, network effects, platform pricing, value allocation, welfare analysis, intermediaries

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