Matchmakers: The New Economics of Multisided Platforms

Amazon. Alibaba. Facebook. Uber. These types of businesses-known as platforms, or multi-sided markets-are driving the economy more than ever. In an environment where markets, consumers, and technology are ever changing and increasingly interdependent, these businesses, which bring together a number of groups who need each other and make it easy for them to work together, are essential. But platforms operate very differently than traditional, one-sided businesses (like, say, grocery stores), and their logic can seem not only counterintuitive but downright counterproductive. In Matchmakers, David Evans and Richard Schmalensee, two economists who were among the first to analyze platform businesses and discover their principles, explain the logic of platforms and how to analyze your own opportunities.