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1、mss # Rochet and Tirole; art. # 09; RAND Journal of Economics vol. 37(3)RAND Journal of Economics Vol. 37, No. 3, Autumn 2006 pp. 645667Two-sidedmarkets:aprogressreportJean-Charles RochetandJean TiroleWeprovidearoadmaptotheburgeoningliteratureontwo-sidedmarketsandpresentnewresults. We identify two-s
2、ided markets with markets in which the structure, and not only the level of pricescharged by platforms, matters. The failure of the Coase theorem is necessary but not sufficient fortwo-sidedness. We build a model integrating usage and membership externalities that unifies two hitherto disparate stra
3、nds of the literature emphasizing either form of externality, and obtain new results on the mix of membership and usage charges when price setting or bargaining determine payments between end-users.1. Introduction?Two-sided (or, more generally, multi-sided1) markets are roughly defined as markets in
4、 which one or several platforms enable interactions between end-users and try to get the two (or multiple) sides “on board” by appropriately charging each side. That is, platforms court each side while attempting to make, or at least not lose, money overall. Examples of two-sided markets readily com
5、e to mind. Videogame platforms, such as Atari, Nintendo, Sega, Sony Play Station, and Microsoft X-Box, need to attract gamers in order to persuade game developers to design or port games to their platform, and they need games to induce gamers to buy and use their videogame console. Software producer
6、s court both users and application developers, client and server sides, or readers and writers. Portals, TV networks, and newspapers compete for advertisers as well as “eyeballs.” And payment card systems need to attractbothmerchantsandcardholders.Therearemanyothertwo-sidedmarketsofinterest,2only a
7、few of which will be mentioned in this article. Butwhatisatwo-sidedmarket,andwhydoestwo-sidednessmatter?Ontheformerquestion,therecentliteraturehasbeenmostlyindustryspecificandhashadmuchofa“Youknowatwo-sidedUniversity of Toulouse; rochetcict.fr.University of Toulouse, and MIT; tirolecict.fr.The previ
8、ous version of this article was entitled “Two-Sided Markets: An Overview.” We thank Mark Armstrong, Jacques Cr emer, Chaim Fershtman, Andrei Hagiu, Jennifer Reinganum, and the participants at the IDEI-CEPR confer- ence on Two-Sided Markets (Toulouse, January 2324, 2004) for useful comments and discu
9、ssions. 1We focus on two-sided markets for expositional simplicity. Many markets or platforms (such as a standard- setting organization attempting to persuade a group of patent owners to join forces to establish a standard and various potential users to adopt it) are multi-sided though. The insights
10、 obtained for two-sided platforms apply more generally to multi-sided ones. 2See, e.g., Armstrong (2006), Evans (2003), Evans, Hagiu, and Schmalensee (2006), and Rochet and Tirole (2003).Copyright2006, RAND.645mss # Rochet and Tirole; art. # 09; RAND Journal of Economics vol. 37(3)646/THE RAND JOURN
11、AL OF ECONOMICSmarketwhenyouseeit”flavor.“Gettingthetwosidesonboard”isausefulcharacterization,butit is not restrictive enough. Indeed, if the analysis just stopped there, pretty much any market would be two-sided, since buyers and sellers need to be brought together for markets to exist and gainsfro
12、mtradetoberealized.Wedefineatwo-sidedmarketasoneinwhichthevolumeoftransactions between end-users depends on the structure and not only on the overall level of the fees charged by the platform. A platforms usage or variable charges impact the two sides willingness to trade once on the platform and, t
13、hereby, their net surpluses from potential interactions; the platformsmembership or fixed charges in turn condition the end-users presence on the platform. Theplatforms fine design of the structure of variable and fixed charges is relevant only if the two sides do not negotiate away the correspondin
14、g usage and membership externalities. Conceptually, the theory of two-sided markets is related to the theories of network exter- nalities and of (market or regulated) multi-product pricing. From the former, initiated by Katz and Shapiro (1985, 1986) and Farrell and Saloner (1985, 1986),3it borrows t
15、he notion that there are noninternalized externalities among end-users.4From the latter, it borrows the focus on price structure and the idea that price structures are less likely to be distorted by market power than price levels. The multi-product pricing literature, however, does not allow for ext
16、ernalities in the consumption of different products: to use a celebrated example, the buyer of a razor internalizes in his purchase decision the net surplus that he will derive from buying razor blades. The starting point for the theory of two-sided markets, by contrast, is that an end-user does not internalize the welfare impact of his use of the platform on other end-users. The rest of the article is organized as follows. In Section 2, we introduce platforms and end-users as w