Two-Sided B to B Platforms

Bruno Jullien

in The Oxford Handbook of the Digital Economy

Published in print August 2012 | ISBN: 9780195397840
Published online November 2012 | | DOI:

Series: Oxford Handbooks

 Two-Sided B to B Platforms

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This article contributes to the understanding of business-to-business (B2B) platforms, drawing on insights from the two-sided market literature. The concept of this market refers to a situation where one or several competing platforms present services that help potential trading partners to interact. A platform that intermediates transactions between buyers and sellers is addressed, where the service consists in identifying the profitable trade opportunities. Two-sided markets provide a framework to investigate platforms' pricing strategies, and a convenient and insightful framework for exploring welfare issues. Key determinants of the competitive process are whether platforms obtain exclusivity from their clients or not, how differentiated they are, and what tariffs they can use. Multihoming may enhance efficiency, but has the potential adverse effect of softening competition. It can be concluded that while the literature has been concerned with antitrust implications, it has delivered few concrete recommendations for policy intervention.

Keywords: B2B platforms; two-sided market; platforms pricing; welfare; multihoming; competition; tariffs

Article.  11024 words. 

Subjects: Economics ; Economic Development and Growth

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