When the platform collects revenue via a commission or a per-unit fee, neither price delegation strategy dominates the other.
This choice influences both the amount of supply available and the overall attractiveness of the platform to consumers. Or the platform could allow unfettered price competition among the servers (e.g., lodging). The platform could assert full control over pricing despite being unaware of the servers’ costs (e.g., ride sharing). We study how prices are chosen and fees are collected on the platform. Gérard Cachon, Tolga Dizdarer, Gerry Tsoukalas (Working), Pricing Control and Regulation on Online Service Platforms.Ībstract: Online service platforms enable customers to connect with a large population of independent servers and operate successfully in many sectors, including transportation, lodging, and delivery, among others.
