2016/02/01 by Andre Boik, Kenneth S. Corts · 2 citations
Business, Management and Accounting · Economics, Econometrics and Finance · #Consumer Market Behavior and Pricing #Digital Platforms and Economics #Merger and Competition Analysis
paper · doi:10.1086/686971
crossref issued 2016/02/01 · crossref published 2016/02/01 · crossref published-print 2016/02/01 · openalex publication_date 2016/02/01 · crossref created 2016/08/26 · crossref deposited 2018/04/07 · openalex created_date 2025/10/10 · crossref indexed 2026/07/27 · openalex updated_date 2026/07/30
In the context of sellers who sell their products through intermediary platforms, a platform most-favored-nation (PMFN) clause is a contractual restriction requiring that a particular seller will not sell at a lower price through a platform other than the one with which it has the PMFN agreement. Contractual restrictions observed in markets for e-books and travel services, among other settings, can be viewed as examples of this phenomenon. We show that PMFN clauses typically raise platform fees and retail prices and curtail entry or skew positioning decisions by potential entrants pursuing low-end business models.