TY  - RPRT
ID  - publications16551
UR  - http://tse-fr.eu/pub/28398
A1  - Lam, Wing Man Wynne
Y1  - 2014/08//
N2  - This paper studies a dynamic two-sided market in which consumers face switching costs between competing products. I first show that, in a symmetric equilibrium, switching costs lower the first-period price if network externalities are strong. By contrast, switching costs soften price competition in the initial period if network externalities are weak and consumers are more patient than the platforms. Second, an increase in switching costs on one side decreases the first-period price on the other side. Finally, consumer heterogeneity such as the presence of more loyal and naive customers on one side intensifies first-period competition on this side but softens first-period competition on the other side.
PB  - TSE Working Paper
T3  - TSE Working Paper
KW  - switching costs
KW  - two-sided markets
KW  - network externality
KW  - naivety
KW  - loyalty
M1  - working_paper
TI  - Switching Costs in Two-sided Markets
AV  - public
ER  -