Exclusionary practices in two‐sided markets: The effect of radius clauses on competition between shopping centers*. (10th May 2018)

• Record Type: Journal Article
• Authors: Brühn, Tim; Götz, Georg
• Is Part Of: Managerial and decision economics. Volume 39:Number 5(2018)
• Page Start: 577
• Page End: 590
• Publication Date: 2018-05-10
• Subjects: Managerial economics -- Periodicals; Decision making -- Periodicals; Management -- Periodicals; 658.15
• DOI: 10.1002/mde.2928
• Languages: English
• ISSNs: 0143-6570

Abstract

Abstract : We analyze exclusionary conduct of platforms in 2‐sided markets. Motivated by recent antitrust cases, we provide a discussion of the likely positive and normative effects of exclusivity clauses, which prevent tenants from opening outlets in other shopping centers covered by the clause. In a standard 2‐sided market model, we show that exclusivity agreements are especially profitable for the incumbent and detrimental to social welfare if competition is intense between the 2 shopping centers. We argue that the focus of courts on market definition is misplaced in markets determined by competitive bottlenecks.