Code for: Variety-Based Congestion in Online Markets: Evidence from Mobile Apps

Principal Investigator(s): View help for Principal Investigator(s) Daniel Ershov, UCL School of Management

Name	File Type	Size	Last Modified
replication_package_final_v3			07/01/2023 05:45:AM

Project Citation:

Ershov, Daniel. Code for: Variety-Based Congestion in Online Markets: Evidence from Mobile Apps. Nashville, TN: American Economic Association [publisher], 2024. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2024-03-29. https://doi.org/10.3886/E181301V1

Project Description

Summary: In many online markets, consumers have to spend time and effort browsing through products. The addition of new products could make other products less visible, creating congestion externalities. Using Android app store data, I take advantage of a natural experiment – a re-design of part of the store – to show evidence of congestion externalities online: more apps in the market directly reduce per-app usage/ downloads. The natural experiment also increases long-run entry, but a structural demand model that accounts for congestion externalities suggests that forty percent of consumer variety welfare gains are lost from higher congestion.

Funding Sources: Social Sciences and Humanities Research Council (Canada); Ontario Graduate Scholarship; The University of Toronto; Agence Nationale de la Recherche (ANR-17-EUR-0010)

Scope of Project

Subject Terms: mobile apps; entry; congestion

JEL Classification:
      D12 Consumer Economics: Empirical Analysis
      D22 Firm Behavior: Empirical Analysis
      L86 Information and Internet Services; Computer Software

Time Period(s): 1/2012 – 12/2014

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Published Versions

V1 [2024-03-29]

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DDI 2.5

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