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The Economics of E-Commerce
This comprehensive collection, edited by two pioneers of e-commerce, presents thirty of the most important papers written in the fields of economics, marketing and strategy. Topics covered include evaluation of the benefit to consumers of competition and product variety online, examination of auctions and reputational feedback mechanisms designed to mitigate informational asymmetries in online markets, and the debate on digital property rights including privacy, piracy and the open source movement. Together with an original introduction by the editors, this title provides a readily accessible wealth of material on the subject of e-commerce, invaluable to scholars and practitioners alike.
More Information
Contributors
Contents
More Information
This comprehensive collection, edited by two pioneers of e-commerce, presents thirty of the most important papers written in the fields of economics, marketing and strategy. Topics covered include evaluation of the benefit to consumers of competition and product variety online, examination of auctions and reputational feedback mechanisms designed to mitigate informational asymmetries in online markets, and the debate on digital property rights including privacy, piracy and the open source movement. Together with an original introduction by the editors, this title provides a readily accessible wealth of material on the subject of e-commerce, invaluable to scholars and practitioners alike.
Contributors
30 articles, dating from 2000 to 2011
Contributors include: M. Armstrong, P. Bajari, E. Brynjolfsson, A. Goldfarb, A. Goolsbee, M.L. Katz, M. Schwarz, C.E. Tucker, H. Varian, J. Waldfogel
Contributors include: M. Armstrong, P. Bajari, E. Brynjolfsson, A. Goldfarb, A. Goolsbee, M.L. Katz, M. Schwarz, C.E. Tucker, H. Varian, J. Waldfogel
Contents
Contents
Introduction
Michael R. Baye and John Morgan
PART I PLATFORMS AS STRATEGIC ACTORS
1. Michael R. Baye and John Morgan (2001), ‘Information Gatekeepers on the Internet and the Competitiveness of Homogeneous Product Markets’, American Economic Review, 91 (3), June, 454–74
2. Jean-Charles Rochet and Jean Tirole (2003), ‘Platform Competition in Two-Sided Markets’, Journal of the European Economic Association, 1 (4), June, 990–1029
3. Bernard Caillaud and Bruno Jullien (2003), ‘Chicken and Egg: Competition among Intermediation Service Providers’, RAND Journal of Economics, 34 (2), Summer, 309–28
4. Mark Armstrong (2006), ‘Competition in Two-Sided Markets’, RAND Journal of Economics, 37 (3), Autumn, 668–91
5. Andrei Hagiu (2009), ‘Two-Sided Platforms: Product Variety and Pricing Structures’, Journal of Economics and Management Strategy, 18 (4), Winter, 1011–43
6. Gerard J. Tellis, Eden Yin and Rakesh Niraj (2009), ‘Does Quality Win? Network Effects Versus Quality in High-Tech Markets’, Journal of Marketing Research, XLVI (2), April, 135–49
PART II IS E-COMMERCE FRICTIONLESS? PRICE DISPERSION AND OBFUSCATION ONLINE
7. Erik Brynjolfsson and Michael D. Smith (2000), ‘Frictionless Commerce? A Comparison of Internet and Conventional Retailers’, Management Science, 46 (4), April, 563–85
8. Michael R. Baye, John Morgan and Patrick Scholten (2004), ‘Price Dispersion in the Small and in the Large: Evidence from an Internet Price Comparison Site’, Journal of Industrial Economics, LII (4), December, 463–96
9. Michael R. Baye, J. Rupert J. Gatti, Paul Kattuman and John Morgan (2009), ‘Clicks, Discontinuities, and Firm Demand Online’, Journal of Economics and Management Strategy, 18 (4), Winter, 935–75
10. Glenn Ellison and Sara Fisher Ellison (2009), ‘Search, Obfuscation, and Price Elasticities on the Internet’, Econometrica, 77 (2), March, 427–52
11. Xavier Gabaix and David Laibson (2006), ‘Shrouded Attributes, Consumer Myopia, and Information Suppression in Competitive Markets’, Quarterly Journal of Economics, 121 (2), May, 505–40
12. Jennifer Brown, Tanjim Hossain and John Morgan (2010), ‘Shrouded Attributes and Information Suppression: Evidence from the Field’, Quarterly Journal of Economics, 125 (2), May, 859–76
PART III DOES E-COMMERCE BENEFIT CONSUMERS? INFORMATION, PRODUCT VARIETY, AND COMPETITION
13. Fiona Scott Morton, Florian Zettelmeyer and Jorge Silva-Risso (2001), ‘Internet Car Retailing’, Journal of Industrial Economics, XLIX (4), December, 501–19
14. Jeffrey R. Brown and Austan Goolsbee (2002), ‘Does the Internet Make Markets More Competitive? Evidence from the Life Insurance Industry’, Journal of Political Economy, 110 (3), June, 481–507
15. Erik Brynjolfsson, Yu (Jeffrey) Hu and Michael D. Smith (2003), ‘Consumer Surplus in the Digital Economy: Estimating the Value of Increased Product Variety at Online Booksellers’, Management Science, 49 (11), November, 1580–96
16. Chris Forman, Anindya Ghose and Avi Goldfarb (2009), ‘Competition Between Local and Electronic Markets: How the Benefit of Buying Online Depends on Where You Live’, Management Science, 55 (1), January, 47–57
PART IV ONLINE AUCTIONS FOR PRODUCTS AND ADVERTISING
17. Hal R. Varian (2007), ‘Position Auctions’, International Journal of Industrial Organization, 25 (6), December, 1163–78
18. Benjamin Edelman and Michael Schwarz (2010), ‘Optimal Auction Design and Equilibrium Selection in Sponsored Search Auctions’, American Economic Review, 100 (2), May, 597–602
19. Patrick Bajari and Ali Hortaçsu (2003), ‘The Winner’s Curse, Reserve Prices, and Endogenous Entry: Empirical Insights from eBay Auctions’, RAND Journal of Economics, 34 (2), Summer, 329–55
PART V MITIGATING INFORMATION ASYMMETRIES: REPUTATION, RECOMMENDATION, AND FEEDBACK MECHANISMS
20. Paul Resnick, Richard Zeckhauser, John Swanson and Kate Lockwood (2006), ‘The Value of Reputation on eBay: A Controlled Experiment’, Experimental Economics, 9 (2), June, 79–101
21. Daniel Houser and John Wooders (2006), ‘Reputation in Auctions: Theory, and Evidence from eBay’, Journal of Economics and Management Strategy, 15 (2), Summer, 353–69
22. Gary E. Bolton, Elena Katok and Axel Ockenfels (2004), ‘How Effective Are Electronic Reputation Mechanisms? An Experimental Investigation’, Management Science, 50 (11), November, 1587–1602
23. Chrysanthos Dellarocas (2003), ‘The Digitization of Word of Mouth: Promise and Challenges of Online Feedback Mechanisms’, Management Science, 49 (10), October, 1407–24
24. Yan Chen, F. Maxwell Harper, Joseph Konstan and Sherry Xin Li (2010), ‘Social Comparisons and Contributions to Online Communities: A Field Experiment on MovieLens’, American Economic Review, 100 (4), September, 1358–98
25. Judith A. Chevalier and Dina Mayzlin (2006), ‘The Effect of Word of Mouth on Sales: Online Book Reviews’ Journal of Marketing Research, XLIII (3), August, 345–54
PART VI BATTLES FOR DIGITAL PROPERTY RIGHTS: PRIVACY, PIRACY, AND THE OPEN SOURCE MOVEMENT
26. Rafael Rob and Joel Waldfogel (2006), ‘Piracy on the High C’s: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students’, Journal of Law and Economics, XLIX (1), April, 29–62
27. Felix Oberholzer-Gee and Koleman Strumpf (2007), ‘The Effect of File Sharing on Record Sales: An Empirical Analysis’, Journal of Political Economy, 115 (1), February, 1–42
28. Benjamin E. Hermalin and Michael L. Katz (2006), ‘Privacy, Property Rights and Efficiency: The Economics of Privacy as Secrecy’, Quantitative Marketing and Economics, 4 (3), September, 209–39
29. Avi Goldfarb and Catherine E. Tucker (2011), ‘Privacy Regulation and Online Advertising’, Management Science, 57 (1), January, 57–71
30. Josh Lerner and Jean Tirole (2002), ‘Some Simple Economics of Open Source’, Journal of Industrial Economics, L (2), June, 197–234
Index
Introduction
Michael R. Baye and John Morgan
PART I PLATFORMS AS STRATEGIC ACTORS
1. Michael R. Baye and John Morgan (2001), ‘Information Gatekeepers on the Internet and the Competitiveness of Homogeneous Product Markets’, American Economic Review, 91 (3), June, 454–74
2. Jean-Charles Rochet and Jean Tirole (2003), ‘Platform Competition in Two-Sided Markets’, Journal of the European Economic Association, 1 (4), June, 990–1029
3. Bernard Caillaud and Bruno Jullien (2003), ‘Chicken and Egg: Competition among Intermediation Service Providers’, RAND Journal of Economics, 34 (2), Summer, 309–28
4. Mark Armstrong (2006), ‘Competition in Two-Sided Markets’, RAND Journal of Economics, 37 (3), Autumn, 668–91
5. Andrei Hagiu (2009), ‘Two-Sided Platforms: Product Variety and Pricing Structures’, Journal of Economics and Management Strategy, 18 (4), Winter, 1011–43
6. Gerard J. Tellis, Eden Yin and Rakesh Niraj (2009), ‘Does Quality Win? Network Effects Versus Quality in High-Tech Markets’, Journal of Marketing Research, XLVI (2), April, 135–49
PART II IS E-COMMERCE FRICTIONLESS? PRICE DISPERSION AND OBFUSCATION ONLINE
7. Erik Brynjolfsson and Michael D. Smith (2000), ‘Frictionless Commerce? A Comparison of Internet and Conventional Retailers’, Management Science, 46 (4), April, 563–85
8. Michael R. Baye, John Morgan and Patrick Scholten (2004), ‘Price Dispersion in the Small and in the Large: Evidence from an Internet Price Comparison Site’, Journal of Industrial Economics, LII (4), December, 463–96
9. Michael R. Baye, J. Rupert J. Gatti, Paul Kattuman and John Morgan (2009), ‘Clicks, Discontinuities, and Firm Demand Online’, Journal of Economics and Management Strategy, 18 (4), Winter, 935–75
10. Glenn Ellison and Sara Fisher Ellison (2009), ‘Search, Obfuscation, and Price Elasticities on the Internet’, Econometrica, 77 (2), March, 427–52
11. Xavier Gabaix and David Laibson (2006), ‘Shrouded Attributes, Consumer Myopia, and Information Suppression in Competitive Markets’, Quarterly Journal of Economics, 121 (2), May, 505–40
12. Jennifer Brown, Tanjim Hossain and John Morgan (2010), ‘Shrouded Attributes and Information Suppression: Evidence from the Field’, Quarterly Journal of Economics, 125 (2), May, 859–76
PART III DOES E-COMMERCE BENEFIT CONSUMERS? INFORMATION, PRODUCT VARIETY, AND COMPETITION
13. Fiona Scott Morton, Florian Zettelmeyer and Jorge Silva-Risso (2001), ‘Internet Car Retailing’, Journal of Industrial Economics, XLIX (4), December, 501–19
14. Jeffrey R. Brown and Austan Goolsbee (2002), ‘Does the Internet Make Markets More Competitive? Evidence from the Life Insurance Industry’, Journal of Political Economy, 110 (3), June, 481–507
15. Erik Brynjolfsson, Yu (Jeffrey) Hu and Michael D. Smith (2003), ‘Consumer Surplus in the Digital Economy: Estimating the Value of Increased Product Variety at Online Booksellers’, Management Science, 49 (11), November, 1580–96
16. Chris Forman, Anindya Ghose and Avi Goldfarb (2009), ‘Competition Between Local and Electronic Markets: How the Benefit of Buying Online Depends on Where You Live’, Management Science, 55 (1), January, 47–57
PART IV ONLINE AUCTIONS FOR PRODUCTS AND ADVERTISING
17. Hal R. Varian (2007), ‘Position Auctions’, International Journal of Industrial Organization, 25 (6), December, 1163–78
18. Benjamin Edelman and Michael Schwarz (2010), ‘Optimal Auction Design and Equilibrium Selection in Sponsored Search Auctions’, American Economic Review, 100 (2), May, 597–602
19. Patrick Bajari and Ali Hortaçsu (2003), ‘The Winner’s Curse, Reserve Prices, and Endogenous Entry: Empirical Insights from eBay Auctions’, RAND Journal of Economics, 34 (2), Summer, 329–55
PART V MITIGATING INFORMATION ASYMMETRIES: REPUTATION, RECOMMENDATION, AND FEEDBACK MECHANISMS
20. Paul Resnick, Richard Zeckhauser, John Swanson and Kate Lockwood (2006), ‘The Value of Reputation on eBay: A Controlled Experiment’, Experimental Economics, 9 (2), June, 79–101
21. Daniel Houser and John Wooders (2006), ‘Reputation in Auctions: Theory, and Evidence from eBay’, Journal of Economics and Management Strategy, 15 (2), Summer, 353–69
22. Gary E. Bolton, Elena Katok and Axel Ockenfels (2004), ‘How Effective Are Electronic Reputation Mechanisms? An Experimental Investigation’, Management Science, 50 (11), November, 1587–1602
23. Chrysanthos Dellarocas (2003), ‘The Digitization of Word of Mouth: Promise and Challenges of Online Feedback Mechanisms’, Management Science, 49 (10), October, 1407–24
24. Yan Chen, F. Maxwell Harper, Joseph Konstan and Sherry Xin Li (2010), ‘Social Comparisons and Contributions to Online Communities: A Field Experiment on MovieLens’, American Economic Review, 100 (4), September, 1358–98
25. Judith A. Chevalier and Dina Mayzlin (2006), ‘The Effect of Word of Mouth on Sales: Online Book Reviews’ Journal of Marketing Research, XLIII (3), August, 345–54
PART VI BATTLES FOR DIGITAL PROPERTY RIGHTS: PRIVACY, PIRACY, AND THE OPEN SOURCE MOVEMENT
26. Rafael Rob and Joel Waldfogel (2006), ‘Piracy on the High C’s: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students’, Journal of Law and Economics, XLIX (1), April, 29–62
27. Felix Oberholzer-Gee and Koleman Strumpf (2007), ‘The Effect of File Sharing on Record Sales: An Empirical Analysis’, Journal of Political Economy, 115 (1), February, 1–42
28. Benjamin E. Hermalin and Michael L. Katz (2006), ‘Privacy, Property Rights and Efficiency: The Economics of Privacy as Secrecy’, Quantitative Marketing and Economics, 4 (3), September, 209–39
29. Avi Goldfarb and Catherine E. Tucker (2011), ‘Privacy Regulation and Online Advertising’, Management Science, 57 (1), January, 57–71
30. Josh Lerner and Jean Tirole (2002), ‘Some Simple Economics of Open Source’, Journal of Industrial Economics, L (2), June, 197–234
Index
