Tying in Two-Sided Markets with Multi-Homing: Corrigendum and Comment

Jay Pil Choi, Bruno Jullien, Yassine Lefouili

Research output: Contribution to journalArticlepeer-review

4 Citations (Scopus)

Abstract

We identify two issues in Choi's [2010] paper on tying in two-sided markets published in this Journal, and provide solutions to both of them. First, we point out that the equilibrium in the absence of tying requires more restrictive conditions and does not satisfy a natural equilibrium refinement criterion. We offer an alternative timing structure that validates the equilibrium derived in Choi [2010] under the conditions provided there. Second, we show that his equilibrium analysis with tying ignores a profitable deviation. We rectify this analysis under our alternative timing structure and derive the (mixed-strategy) equilibrium with tying. We also show by means of simulations that tying is welfare-enhancing whenever it is profitable, which is consistent with the main finding in Choi [2010].

Original languageEnglish
Pages (from-to)872-886
Number of pages15
JournalJournal of Industrial Economics
Volume65
Issue number4
DOIs
Publication statusPublished - 2017 Dec

Bibliographical note

Funding Information:
∗We are grateful to the Editor and two referees for very helpful comments and suggestions. The financial support of the European Research Council (ERC) under the European Union’s Horizon 2020 research and innovation programme (grant agreement No. 670494) and the National Research Foundation of Korea Grant funded by the Korean Government (NRF-2016S1A5A2A01022389) is gratefully† acknowledged.

Publisher Copyright:
© 2017 The Editorial Board of The Journal of Industrial Economics and John Wiley & Sons Ltd

All Science Journal Classification (ASJC) codes

  • Accounting
  • Business, Management and Accounting(all)
  • Economics and Econometrics

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