This essay provides an overview of the basic economics literature on multi-sided platforms, focusing on ways in which they businesses differ from ordinary single-sided businesses. Distinctive aspects of startup, pricing, welfare analysis, and competition are discussed.
Multi-sided platforms reduce transactions costs and thereby facilitate value-creating interactions between two or more different types of economic agents.
KeywordsPlatform Multi-sided Two-sided Network Externality Network effects Critical mass
JEL CodesD40 L10 L19
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