Cost Pass-Through with Network Externalities

We analyze the rate at which cost shocks are passed through to prices when the market exhibits network externalities. We find that the pass-through rate is smaller in the presence of network externalities. Also, the deadweight loss created by a cost shock is smaller in a network market.

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Year of publication:	2011
Authors:	Baraldi, Anna Laura ; Rojas, Christian
Published in:	International Journal of Business and Economics. - College of Business, ISSN 1607-0704. - Vol. 10.2011, 3, p. 177-199
Publisher:	College of Business
Subject:	network externalities \| cost pass-through \| deadweight loss

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Extent:	application/pdf text/html
Type of publication:	Article
Classification:	D6 - Welfare Economics ; D85 - Network Formation ; H23 - Externalities; Redistributive Effects ; Environmental Taxes and Subsidies
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010599009