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INTRODUCTION
As part of IDEI's research
into network economics, we
have formally developed
theory to analyze markets
that act as platforms
connecting disparate
groups. The value of a
multi-sided market platform
to each group it serves
increases as the size of
every other group grows. A
stock exchange matches
buyers and sellers, a
television station matches
creators of programming and
viewers, and a payment card
association matches
merchants and cardholders.
The IDEI Payment Card
Center of Research
Excellence (Payment Card
CORE) provides a repository
for scholarly work on
multi-sided markets, with a
particular emphasis on the
economics of payment cards.
The structure of
multi-sided markets, tools
for optimizing pricing to
each side of a multi-sided
market and the implications
for competition policy are
all addressed.
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