Two-sided markets

Case: Moon, Y., “Uber: Changing The Way The World Moves” Harvard Business School Case No. 316-101, January 2017
  • The world’s largest retailer, Alibaba, has no stock
  • The world’s largest taxi company, Uber, owns no cars
  • AirBnB own no hotels
  • Facebook produce very little media content

In this Vanity Fair article, Uber co-founder Travis Kalanick defends surge pricing:

“You want supply to always be full, and you use price to basically either bring more supply on or get more supply off, or get more demand in the system or get some demand out,” he lectures like a professor. “It’s classic Econ 101.”

An excellent article on the incentives of platform industrys is “The Host’s Dilemma” by Jonathan Barnett. He argues that platform providers face a trade off between being open (and generating users) and regulating access (to monetise).

Recommended reading: Barnett, J.M., The Hosts Dilemma, Harvard Law Review


This page ties into Chapter 3 of Economics: A Complete Guide for Business

Learning Objectives: Peer-to-peer markets, Ethical implications of disruptive business models

Cutting edge theory: An economic analysis of platforms

Spotlight on sustainability: Employee welfare

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