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Competition in Digital Buyer-supplier platforms

Paper Session

Friday, Jan. 5, 2018 10:15 AM - 12:15 PM

Pennsylvania Convention Center, 203-A
Hosted By: Industrial Organization Society
  • Chair: Judith A. Chevalier, Yale University

Regulatory Distortion: Evidence from Uber's Entry Decisions in the US

Haldun Anil
,
Smart Asset
Sara Fisher Ellison
,
Massachusetts Institute of Technology and CESifo

Abstract

There is a large and long-standing literature on the distortionary effects of regulations on the functioning of markets. A newer strand of this literature focuses on licensing regulations, such as state-specific licensing of teachers and hairdressers. We seek to add to this literature with the specific case of ride-hailing services, such as Uber. We assemble a new and comprehensive data set of 250 US cities and their regulations regarding hackney services. We specify a stylized profit model for Uber, which is a function of these regulations, and estimate the parameters of the profit function using observed Uber entry decisions into these cities. Our data set and empirical strategy allow us to estimate the differential effects of particular types of regulations, separating out regulations governing safety, governing operations, and erecting entry barriers. We find that safety regulations do not have a distortionary effect on the functioning of the market for hackney services and evading them does not increase Uber's profits. We find evidence that Uber's profits are increased, however, by their ability to evade regulatory entry barriers and regulations governing operations. In other words, those regulations do have a significant distortionary effect on the market. To the extent that safety-related regulations are welfare-enhancing and those erecting entry barriers are welfare-decreasing, our results suggest a welfare-enhancing effect of Uber's entry.

Market Structure with the Entry of Peer-to-Peer Platforms: The Case of Hotels and Airbnb

Chiara Farronato
,
Harvard Business School
Andrey Fradkin
,
Massachusetts Institute of Technology and Airbnb Inc.

Abstract

Market Structure with the Entry of Peer-to-Peer Platforms: The Case of Hotels and Airbnb

A Mariel Boatlift for Programmers?: The Russian Online Labor Market Response to the Collapse of the Ruble

John J. Horton
,
New York University
Bo Cowgill
,
Columbia University

Abstract

A Mariel Boatlift for Programmers?: The Russian Online Labor Market Response to the Collapse of the Ruble

Price Salience and Product Choice

Thomas C. Blake
,
eBay
Sarah Moshary
,
University of Pennsylvania

Abstract

Price Salience and Product Choice
Discussant(s)
Tobias Salz
,
Columbia University
Kevin Williams
,
Yale University
Jennifer Brown
,
University of British Columbia and University of Utah
Avi Goldfarb
,
University of Toronto
JEL Classifications
  • L1 - Market Structure, Firm Strategy, and Market Performance
  • L0 - General