Pricing model in the market for network goods in terms of duopolistic competition
Reviews
Readers community rating
0.0 (0 votes)


Views
2104


Downloads
1996
UDC
33 Экономика. Народное хозяйство. Экономические науки
Date of publication
14.11.2018
Public year
2018
Pricing model in the market for network goods in terms of duopolistic competition
Read   Download pdf
Annotation
The article is devoted to analyzing peculiarities of pricing in the markets for network goods. Such markets are usually oligopolies. This is due to the double economies of scale: when the size of the network increases, the consumer value of such a good rises whereas cost per unit falls. As a result, the singularity of pricing in the market for network goods is the interdependence of prices, demand, the achieved size of a network and consumer values. On the basis of the model of a duopoly, we consider the distribution of the effect of the output of new network goods between generator and imitator. Generator is an agent, who offers to the market a fundamentally new product, imitator is an agent, who may quickly reproduce innovation. The peculiarities of the proposed model include taking two types of investment (direct and precautionary) as well as the scale of the consumer value into consideration. The dynamic of changes in the value of a good is a logistic function where the dependent variable is the number of consumers (instead of time). Generator has to take into account the threat of entering the market imitator, since the outcome time of the imitator affect the amount and distribution of total benefit. That is why generator is beneficial at the stage of formation of network to set low prices for products. The low price in the initial period let to increase quickly the growing demand for a network good. The lower this price in the initial period, the sooner it is possible to increase the growing demand for a network good. This may mean that the imitator will fail to receive a large share of the benefits.
About authors
Victor Dementiev
Scientific concept adviser
Central Economics and Mathematics Institute, Russian Academy of Sciences
Elena Ustyuzhanina
Head of Economics Department
Plekhanov Russian University of Economics
Sergey Evsyukov
Senior Researcher, CEMI RAS
References

1. Antipina O.N. (2009). Teoreticheskie osnovy tsenoobrazovaniya na rynkakh informatsionnykh blag i tekhnologij // Voprosy novoj ehkonomiki. № 4. S. 12–22

2. Afanas'eva K.E., Shiryaev V.I. (2007). Prognozirovanie regional'nykh rynkov sotovoj svyazi // Problemy prognozirovaniya. № 5. S. 97–105.

3. Dement'ev V.E. (2008). Strategiya operezheniya v usloviyakh oligopol'noj konkurentsii na rynkakh novoj produktsii. V sb.: “Teoriya i praktika institutsional'nykh preobrazovanij v Rossii”. M.: TsEhMI RAN. Vyp. 10. S. 5–10.

4. Evsyukov S.G., Sigarev A.S., Ustyuzhanina E.V. (2016). Model' dinamicheskogo tsenoobrazovaniya na rynke se- tevykh blag v usloviyakh monopolii postavschika // Finansovaya analitika: problemy i resheniya. № 30 (312). S. 2–18.

5. Kristensen K. (2015). Dilemma innovatora. Kak iz-za novykh tekhnologij pogibayut sil'nye kompanii. M.: Al'pina-Pablisher.

6. Litvin N.D. (2003). Modelirovanie protsessov tsenovoj diskriminatsii v ehlektronnoj kommertsii // Trudy Dal'nevostochnogo gosudarstvennogo tekhnicheskogo universiteta, DFU. № 135. S. 89–98.

7. Makarov V.L. (2002). O matematicheskikh modelyakh konkurentsii mezhdu predpriyatiyami // Ehkonomicheskaya nauka sovremennoj Rossii. № 1. S. 5–9.

8. Pleschinskij A.S. (2017). Analiz konkurentsii i sotrudnichestva pri razrabotke tekhnologicheskikh innovatsij v otraslyakh promyshlennosti // Ehkonomika i matematicheskie metody. № 3. S. 38–58.

9. Pleschinskij A.S., Zhil'tsova E.S. (2013). Analiz rezul'tatov modernizatsii proizvodstva v usloviyakh oligopol'noj konkurentsii innovatora i ego presledovatelya // Ehkonomika i matematicheskie metody. № 1. S. 88–105.

10. Semenychev V.K., Korobetskaya A.A. (2012). Model' zhiznennogo tsikla produkta na osnove drobno-ratsional'nogo trenda s proizvol'noj asimmetriej // Ehkonomika i matematicheskie metody. T. 48. № 3.S. 106–112.

11. Sigarev A.V. (2016). Internet-magaziny. Osobennosti tsenoobrazovaniya na ehlektronnykh rynkakh. V sb.:“Sovremennaya ehkonomika: kontseptsii i modeli innovatsionnogo razvitiya”. Materialy VIII Mezhdunarodnoj nauchno-prakticheskoj konferentsii, REhU im. G.V. Plekhanova. S. 121–125.

12. Strelets I.A. (2008). Ehkonomika setevykh blag // Mirovaya ehkonomika i mezhdunarodnye otnosheniya. № 10. S. 77–83.

13. Fligstin N. (2013). Arkhitektura rynkov. Ehkonomicheskaya sotsiologiya kapitalisticheskikh obschestv XXI veka. M.: Izdatel'skij dom NIU VShEh.

14. Bass F.A. (1969). New Product Growth Model for Consumer Durables // Management Science. No. 15. P. 89–113.

15. Cabral L.M.B., Salant D.J., Woroch G.A. (1999). Monopoly Pricing with Network Externalities // International Journal of Industrial Organization. No. 17. P. 199–214.

16. Chen J. (2016). How Do Switching Costs Affect Market Concentration and Prices in Network Industries? // The Journal of Industrial Economics Vol. 64. Issue 2. P. 226–254.

17. Economides N., Himmelberg Ch. (1995). Critical Mass and Network Size with Application to the US FAX Market. Discussion Paper EC‑95–11, Stern School of Business, New York University.

18. Fudenberg D., Tirole J. (2000). Pricing a Network Good to Deter Entry // The Journal of Industrial Economics. Vol. 48. No. 4. P. 373–390.

19. Goolsbee A., Klenow P.J. (2000). Evidence on Learning and Network Externalities in the Diffusion of Home Computers. NBER Working Paper No. W7329.

20. Katz M.L., Shapiro C. (1986). Technology Adoption in the Presence of Network Externalities // The Journal of Political Economy. Vol. 94. No. 4. P. 822–841.

21. Kucharavy D., Guio R. de (2007). Application of S-Shaped Curves. TRIZ-Future Conference 2007: Current Scientific and Industrial Reality. Nov. 2007. Frankfurt, Germany. P. 81–88.

22. MacKie-Mason J.K., Varian H.R. (1995). Pricing Congestible Network Resources // IEEE Journal on Selected Areas in Communications. Vol. 13. Issue. 7. P. 1141–1149.

23. Saaskilahti P. (2016). Buying Decision Coordination and Monopoly Pricing of Network Goods // Journal of Economics & Management Strategy. Vol. 25. Issue 2. P. 313–333.

24. Ulph D., Vulkan N. (2000). Electronic Commerce and Competitive First-Degree Price Discrimination. UCL and University of Bristol, February.

Полная версия доступна только подписчикам
Подпишитесь прямо сейчас