Principles of Economics and Business 2 Exam

Birkinshaw (2018) states that “the bigger the firms, the bigger they are likely to become”. To which principle in network economics is he referring to?

On the one hand standards facilitate an interoperable infrastructure for network goods On the other hand, standards are main weapons in the competition between providers of network goods. To what network economics phenomenon is referred here?

Complements describe goods and services built on a platform that enhance the value of a core good to a network via ______. Which word should be filled in on the blank?

The market dominance of the big tech platforms is often compared with the classic monopolies of the 19 and 20th century. How do, according to Rahman and Thelen (2019), the new big tech platforms differ from the old monopolies in dominating the market?

Some economists equate network effects with market failure. Why do they think this is the case?

Cowan and Tabarrok (2016) state that the best products may not always win, because...

What is, according to the so-called Chicago School, the main argument in defending the concentration of economic power by firms?

In their article about the Hub Economy lansiti and Lahkani (2017) express their concern about the market concentration of the Big Tech platforms. How can Big Tech Platforms contribute to decreasing market concentration, according to the authors?

Have a look at the graph below. Which ‘law' is illustrated here and together with which other economic phenomenon does it explain the exponential growth of digital technologies?

Video-games are a nit-ariven pusiness. in this case a piatform needs relatively few hits to generate network effects. How do Zhu and lansiti (2019) call this type of network effects?

Google's subsidizes the use of Chromebooks in education. Why do digital platforms subsidize hardware investments?

What type of network effects does Amazon generate by using recommender systems?

Thumbtack, a marketplace that connects consumers with local service providers such as electricians, guitar teachers etc., charges for lead generation before customers and providers decide to work together. What does Thumbtack try to avoid?

To get its platform started OpenTable first persuaded one group to join the platform, and once enough members of that group have done so, they persuaded the other group to join. How is this critical mass strategy called?

In 2021 whistleblower Frances Haugen criticized Facebook for prioritizing profit making over protecting privacy and security. This negative news impacted the use of Facebook. What type of network effects are important here particular for advertising companies?

Metcalfe's law states that the financial value or influence of a telecommunications network is proportional to the number of connected users of the system. Based on this insight it is possible to calculate the number of network connections and based on these also the network value. Suppose there are three small networks A, B, and C. A connects 47 people, B connects 33 people, and C connects 25 people. Calculate the difference between the total sum of the network connections of these three, separate networks and the network connections of the merged, big network?

Pagani distinguishes three control point constellations (CPC). One of them is the loosely coupled CPC. Which one resembles most with the organizational forms that are described by Rahman and Thelen (2019)?

According to Rahman and Thelen (2019) platform companies differ from network-of-contracts companies as far as benefitting from 'patient capital'. What is meant by patient capital?

What is an important flaw of Metcalfe's Law?

Which type of effect is generated when an increase in the number of game console users creates a rise in number of game developers (and vice versa)?

To solve the chicken-egg problem digital platforms can develop different strategies. What type of strategies do they need to develop?

Uber riders and drivers experience low multi-homing costs for their ride-hail services. This is threatening Uber's competitive position because

To avoid the risk of being disintermediated platforms often withhold contact information of the users of the platform. What, according to Zhu and lansiti (2019), is an alternative and often an effective strategy to deal with the risk of being disintermediated?

Which platform strategy is described here: the set of activities or strategic moves that a sponsor can use to shape market dynamics and gain momentum when there are competing platforms?

Information goods are called to be non-rival. What is meant by this?

According to Ozalp et at (2022) digital platforms can achieve rapid growth through:

Which process is described here: Penetration of infrastructures, economic processes, and governmental frameworks of digital platforms in different economic sectors and spheres of life.

Which of the following statements of Predatory Pricing is correct?

In the Digital Market Act the EU appoints Big Tech companies as gatekeepers based on a set of criteria. On which principle is this legislation based?

To grow fast Zoom (videotelephony service) deliberately chose a...

In 2011 Facebook bought Snaptu from the Israelian start-up Moblica for $78 mln. What was the strategic reason of Facebook to buy this application?

Mark Zuckerberg launched Threads this year in compete with Twitter (now X). How would you call this competitive strategy?

Selling your products on the Amazon platform is sometimes called “swimming with sharks”. What is meant by this?

With Bing Microsoft entered the market of web search in which Google has a dominant position. How would you call Microsoft's strategy?

Amazon allows third-party sellers to sell their products on the Amazon platform. During the last lecture we concluded that the Amazon platform is not a neutral marketplace. What is meant by this?

According to Pan et al, platform companies can employ different development strategies. One of them is to organize a set of activities that a sponsor can use to fortify platform boundaries and promote a collective identity in a platform. What is the name of this strategy?

Google made several attempts to become a social network in order to attack Facebook's dominant position in the social network market. How is this Google strategy called?

Android allows app developers to develop apps for different mobile devices on the Android platform in order to

Smart phones have incorporated many different functionalities, which is sometimes called convergence. Which type of strategy of digital platforms is driving this convergence process?

What, according the Rahman and Thelen (2019), is an important weakness in the US antitrust law?

The Matthew Effect

Network effects and market dominance

The Chicago School

Cross-side network effects

Envelopment Strategy

Metcalfe's Law

Path-dependency of standards

First mover advantage

Market dominance

Loosely coupled constellations

Same-side network effects

Switching Cost

Two-step strategy

Multi-homing costs

Hardware capture

Two-sided network effects

Predatory Pricing

Coring Strategy

Patient capital

Platformization

Envelopment Strategy

Negative network effects

Non-rivalrous characteristic

Seeding strategy

Indirect data capture