Exclusionary practices in two-sided markets: The effect of radius clauses on competition between shopping centers

Exclusionary practices in two-sided markets The effect of radius clauses on competition between shopping centers

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...

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Bibliographic Details
Published in:Managerial and decision economics Vol. 39; no. 5; pp. 577 - 590
Main Authors: Brühn, Tim, Götz, Georg
Format: Journal Article
Language:English
Published: Chichester Wiley (Variant) 01-07-2018
Wiley Periodicals Inc
Subjects:
Courts
Markets
RESEARCH ARTICLE
Shopping
Shopping centers
Social welfare
Tenants
Online Access:Get full text
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Summary: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.
ISSN:0143-6570
1099-1468
DOI:10.1002/mde.2928