Sequential pricing on multisided platforms

Abstract

Multisided platforms have emerged as an increasingly important market structure with the rise of the digital economy. In this paper, we consider sequential price setting behavior by platforms and demonstrate sequential pricing outcomes Pareto dominate simultaneous pricing outcomes in terms of firm and industry profits. We compare policy implications and find prices are more balanced across the platform and average prices are higher under sequential pricing than under simultaneous pricing. We also demonstrate that pricing power can be considered independently on each side of the market under multihoming behavior.

Keywords

JEL codes

Reference

Philippe Bontems, Stephen F. Hamilton, and Jason Lepore, “Sequential pricing on multisided platforms”, Economics Letters, vol. 255, n. 112543, September 2025.