EQUILIBRIUM DETERMINATION, TWO-SIDED MARKETS AND PLATFORMS COMPETITION: THE NIGERIAN MOBILE COMMUNICATION MARKET
Abstract
The study develop a theoretical model for analysing two-sided markets that allows for
global multi-homing among agents in the mobile communication market. The model
explained the determination of equilibrium outcome, price structure and consumer surplus
given competitive platforms and non-exclusivity of services in the Nigerian Mobile
communication market. Multiple equilibria as well as maximum platform profit from
monopoly rent with associated deadweight losses on the side of the buyers (software
subscribers) are feasible given the market structure. The pricing structure is seemingly
suboptimal of social welfare under such the current setting. The unique observation about
the market having mixed features of both monopoly and perfect completion appears to be
critical to the outcome of the theoretical model. Consumer welfare is likely to be promoted
with strict enforcement of anti-trust policy needed to regulate any form of collusion.
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