This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. Journals
  3. American Economic Review
  4. May 2017
  5. Multidimensional Platform Design

American Economic Review

ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)

Multidimensional Platform Design

  • André Veiga
  • E. Glen Weyl
  • Alexander White
American Economic Review
vol. 107, no. 5, May 2017
(pp. 191–95)
Download Full Text PDF

Abstract

Successful platforms attract not just many users, but also those of the right kind. 'The right kind of user' is one who can either be directly monetized or who differentially attracts other valuable users. Bonacich centrality on the network of user sorting with direct value of monetization captures this feedback loop and thus characterizes the value of user characteristics. We use this value to determine optimal steady-state platform design and reliable means for platforms to reach such a steady state. We apply these results respectively to explain the dynamic growth strategy of social networks and urban development policies of cities.

Citation

Veiga, André, E. Glen Weyl, and Alexander White. 2017. "Multidimensional Platform Design." American Economic Review, 107 (5): 191–95. DOI: 10.1257/aer.p20171044

Additional Materials

JEL Classification

  • D42 Market Structure, Pricing, and Design: Monopoly
  • D85 Network Formation and Analysis: Theory
  • R58 Regional Development Planning and Policy
  • Z13 Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification