B0674
Title: Semiparametric analysis of two-sided markets
Authors: Senay Sokullu - University of Bristol (United Kingdom) [presenting]
Abstract: An empirical semiparametric model is considered for two-sided markets. Contrary to existing empirical literature on two-sided markets, we specify network effects and probability distribution functions of net benefits of the two sides nonparametrically. We then estimate the model by nonparametric IV regression for local daily newspapers from the US. We show that semiparametric specification is supported by the data and the network effects are neither linear nor monotonic. With a numerical illustration we demonstrate that the mark-up of the newspaper on each side changes drastically with the nonlinearly specified network effects from the case with linear network effects.
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