Bio: A monopolist selling a network good to heterogeneous users is shown to become a two-sided platform if it can condition prices on some user characteristics or if it cannot but induces user self-selection by offering screening contracts. This shows that the availability of sophisticated pricing instruments is essential to make a platform two-sided, not the ability to distinguish separate user groups. The use of freemium strategies (which consists of offering a base version at zero price and a premium version at a positive price) emerges as a special case of versioning.
Abstract: Paul Belleflamme graduated in economics at the University of Namur (1991), where he received his doctoral degree in economics (1997). Since September 2002, Paul is professor of economics at UCLouvain, where he is attached to the Center for Operations Research and Econometrics (CORE) and to the Louvain School of Management (LSM). Paul’s main research area is theoretical industrial organisation, with a special focus on innovation in the digital economy (which is also the main topic of his blog, www.IPdigIT.eu). Paul has published widely in leading economics journals and he co-authored two books with Martin Peitz: Industrial Organization: Markets and Strategies (Cambridge University Press, 2010 and 2015) and The Economics of Platforms: Concepts and Strategy (Cambridge University Press, 2021). Paul is a fellow of the CESifo Research Network. He is associate editor of Journal of Economics and managing editor of Regards Economiques and DialogEco. He also served as associate editor of Information Economics and Policy, and of Review of Network Economics.
By Paul Belleflamme and Martin Peitz
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