Document de travail

Compatibility Choices under Switching Costs

Doh-Shin Jeon, Domenico Menicucci et Nikrooz Nasr

Résumé

e study firms’ compatibility choices in the presence of consumers’ switching costs. We analyze both a model of once-and-for-all compatibility choices and that of dynamic choices. Contrary to what happens in a static setting in which firms embrace compatibility to soften the current competition (Matutes and Régibeau, 1988), when consumer lock-in arises due to a significant switching cost, firms make their products incompatible in order to soften future competition, regardless of the model we consider. This reduces consumer surplus and social welfare.

Mots-clés

Compatibility; Incompatibility; Switching Cost; Lock-in;

Codes JEL

  • D43: Oligopoly and Other Forms of Market Imperfection
  • L13: Oligopoly and Other Imperfect Markets
  • L41: Monopolization • Horizontal Anticompetitive Practices

Référence

Doh-Shin Jeon, Domenico Menicucci et Nikrooz Nasr, « Compatibility Choices under Switching Costs », TSE Working Paper, n° 16-691, septembre 2016, révision décembre 2018.

Voir aussi

Publié dans

TSE Working Paper, n° 16-691, septembre 2016, révision décembre 2018