The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Mobile Applications, the Economics of

  • Timothy Bresnahan
  • Jason Davis
  • Timothy Jaconette
  • Pai-Ling Yin
Reference work entry


The huge and rapid explosion in mobile devices and apps has created a fertile ground for innovation and interesting challenges for evolution in this space. Mobile app marketplaces currently feature an extremely high supply of apps, creating intense competition to get noticed by consumers. This gives corporate developers an advantage, since they have existing marketing infrastructure to promote their apps. In the USA, popular developers are building apps for both iOS and Android platforms, allowing the coexistence of these platforms to persist. App developer strategies vary by market: those that make mobile game apps see success most often when building multiple different game apps. However, firms that make a non-game app are most successful when they focus on continuous improvements to only one app. Commercialisation strategies are also evolving: while advertising is the most common monetisation strategy, many app developers see higher revenue yields through in-app purchases. This article explores these issues in detail.


Android App App developers Apple App marketplace App store Burst campaign Cell phone Commercialisation Google Industry evolution Innovation iOS Mobile Monetisation Multihoming Platform Strategy Technology 

JEL Classifications

L10 L14 L17 L100 L140 L170 M37 O3 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Timothy Bresnahan
    • 1
  • Jason Davis
    • 1
  • Timothy Jaconette
    • 1
  • Pai-Ling Yin
    • 1
  1. 1.