NBER Working Papers by Marc Rysman

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Working Papers

March 2012Platform Pricing at Sports Card Conventions
with Ginger Zhe Jin: w17959
We study a new data set of US sports card conventions in order to evaluate the pricing theory of two-sided markets. Conventions are two-sided because organizers must set fees to attract both consumers and dealers. We have detailed information on consumer price, dealer price and, since most conventions are local, the market structure for conventions. We present several findings: first, consumer pricing decreases with competition at any reasonable distance, but pricing to dealers is insensitive to competition and in longer distances even increases with competition. Second, when consumer price is zero (and thus constrained), dealer price decreases more strongly with competition. These results are compatible with existing models of two-sided markets, but are difficult to explain without such m...
February 2009Dynamics of Consumer Demand for New Durable Goods
with Gautam Gowrisankaran: w14737
Most new consumer durable goods experience rapid prices declines and quality improvements, suggesting the importance of modeling dynamics. This paper specifies a dynamic model of consumer preferences for new durable goods with persistently heterogeneous consumer tastes, rational expectations, and repeat purchases over time. We estimate the model on the digital camcorder industry using panel data on prices, sales and characteristics. We find that the one-year elasticity in response to a transitory industry-wide price shock is about 25% less than the one-month elasticity. Standard cost-of-living indices overstate welfare gain in later periods due to a changing composition of buyers.

Published: "Dynamics of Consumer Demand for New Durable Goods," (with Marc Rysman) (Journal of Political Economy 120, 1173-1219, 2012)

March 2004Coordination vs. Differentiation in a Standards War: 56K Modems
with Angelique Augereau, Shane Greenstein: w10334
56K modems were introduced under two competing incompatible standards. We show the importance of competition between Internet Service Providers in the adoption process. We show that ISPs were less likely to adopt the technology that more competitors adopted. This result is particularly striking given that industry participants expected coordination on one standard or the other. We speculate about the role of ISP differentiation in preventing the market form achieving standardization until a government organization intervened.

Published: Augereau, Angelique, Shane Greenstein and Marc Rysman. "Coordination versus Differentiation in a Standards War: 56K Modems." Rand Journal of Economics 34,4 (2006): 889-911.

February 2002Unobserved Product Differentiation in Discrete Choice Models: Estimating Price Elasticities and Welfare Effects
with Daniel A. Ackerberg: w8798
Standard discrete choice models such as logit, nested logit, and random coefficients models place very strong restrictions on how unobservable product space increases with the number of products. We argue (and show with Monte Carlo experiments) that these restrictions can lead to biased conclusions regarding price elasticities and welfare consequences from additional products. In addition, these restrictions can identify parameters which are not intuitively identified given the data at hand. We suggest two alternative models that relax these restrictions, both motivated by structural interpretations. Monte-Carlo experiments and an application to data show that these alternative models perform well in practice.

Published: Daniel A. Ackerberg & Marc Rysman, 2005. "Unobserved Product Differentiation in Discrete-Choice Models: Estimating Price Elasticities and Welfare Effects," RAND Journal of Economics, The RAND Corporation, vol. 36(4), pages 771-788, Winter. citation courtesy of

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