Transparency and control in platforms for networked markets

DOI10.1287/OPRE.2021.2244MaRDI QIDQ5095169zbMATH OpenOpenAlexFDO

Authors John Pang, W. Lin, Hu Fu, Jack Kleeman, Eilyan Bitar, Adam Wierman

Publication date 5 August 2022

Published in Operations Research (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/1903.04574, https://resolver.caltech.edu/CaltechAUTHORS:20190626-105727708

zbMATH Keywords

games/group decisionsnetworks/graphs

Mathematics Subject Classification ID

Applications of game theory (91A80) Special types of economic markets (including Cournot, Bertrand) (91B54)

Abstract: In this paper, we analyze the worst case efficiency loss of online platform designs under a networked Cournot competition model. Inspired by some of the largest platforms in operation today, the platform designs that we consider examine the trade-off between transparency and control. Our results show that open access designs incentivize increased production towards perfectly competitive levels and limit efficiency loss, while controlled allocation designs lead to producer-platform incentive misalignment, resulting in low participation and unbounded efficiency loss. We also show that discriminatory access designs balance transparency and control, achieving the best of both worlds by maintaining high participation rates while limiting efficiency loss.

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Cites work

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Cited in

(4)

• Inducing information transparency: the roles of gray market and dual-channel
• Strategic limitation of market accessibility: search platform design and welfare
• Platform design when sellers use pricing algorithms
• Optimal search segmentation mechanisms for online platform markets

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