Topic:Spillover effects and Vertical Contracts in Two-Sided Markets——an Application to the Shopping Malls

Lecturer:Rong Luo

Rong Luo is an associate professor of Economics at Renmin University of China.She received his Ph.D. from Pennsylvania State University. Current research topics include M&A analysis, anti-monopoly research in platform industries, firm dynamic pricing, product network effects, firm upstream and downstream contracts, discrete choice models,firm productivity estimation, one-price law,and the impact of exclusive contracts on second-hand housing prices.The results are published in Management Science,International Economics Review, International Journal of Industrial Organization, Journal of Economics & Management Strategy, Applied Economics, etc.She presided over the National Natural Science Foundation youth Project.

Abstract:

In many two-sided markets, stores vary in their strength to attract customers and thus the spillover effects to other stores, and platforms charge the stores different fees. In this paper, we set up a model of the consumer demand, the stores' pricing game, and the bargaining between shopping malls and the stores, where the spillover effect directly affect the store-level number of customers. Using data on store-level rental contracts and customers for 15 shopping malls in Shanghai, we estimate the spillover effects provided by different types of stores and their bargaining power as a function of store type, store size, and contract duration. The results confirm heterogeneous spillover effects provided by different stores. We also find that the stores' bargaining power increases with the store size and contract duration but decreases with the mall's size. Our counterfactual analysis compares the equilibrium results of three types of vertical contracts, the revenue-sharing, fixed fee, and the maximum of the two.

Time:5:00-6:00p.m,October 17th,2024

Venue:B321,Zhixin Building,Central Campus