Amateurs Crowds & Professional Entrepreneurs as Platform Complementors / Kevin J. Boudreau.

By:

Boudreau, Kevin J

Contributor(s):

National Bureau of Economic Research

Material type: Text

TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w24512.Publication details: Cambridge, Mass. National Bureau of Economic Research 2018.Description: 1 online resource: illustrations (black and white)Subject(s):

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Abstract: Platforms often have "crowds" of amateurs working on them as complementors, in other cases professional entrepreneurs--or both. What can a platform owner do to implement these outcomes? I document evidence on mobile app developers showing that just small, incremental changes in platform design--related to the bare minimum costs required to build an app and factors affecting non-pecuniary payoffs--can lead the "bottom-to-fall-out" of the market to amateurs. Where the bottom-falls-out, there is a flood of lowest-quality developers who nonetheless are long-lived on the platform and engage in relatively high development activity. I find no evidence that amateurs crowd-out development activity of top developers in this context. Moreover, the bottom-falling-out is associated with the generation of significantly greater numbers of highest-quality products. I discuss several interpretations.

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Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección NBER	nber w24512 (Browse shelf(Opens below))	Not For Loan

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April 2018.

Platforms often have "crowds" of amateurs working on them as complementors, in other cases professional entrepreneurs--or both. What can a platform owner do to implement these outcomes? I document evidence on mobile app developers showing that just small, incremental changes in platform design--related to the bare minimum costs required to build an app and factors affecting non-pecuniary payoffs--can lead the "bottom-to-fall-out" of the market to amateurs. Where the bottom-falls-out, there is a flood of lowest-quality developers who nonetheless are long-lived on the platform and engage in relatively high development activity. I find no evidence that amateurs crowd-out development activity of top developers in this context. Moreover, the bottom-falling-out is associated with the generation of significantly greater numbers of highest-quality products. I discuss several interpretations.