Economic Analysis Of Monopoly Power In Online Retail Platform

With the rapid development of online shopping platform,the total market share of Alibaba platform and JD.com has achieved more than 80%,which should belongs to a high concentration market.According to the relevant theory in the Industrial Economics,this kind of market needs regulation.However,there is no anti-trust investigation or regulation among the world.Previous research are focus on the monopoly conduct and the measurement of market power.There is a lack of concern about the sources of monopoly power and the characteristics of the online retail environment.This paper starts from the historical evolution of the traditional retail model,combining the characteristics of online retail mode,drawing out the main relationship and decision variables of the retail platform relative to its supply side and consumption side.And put forward the concept analysis framework of the monopoly power of retail platform.The framework points out that the nature of the monopoly power of the retail platform is the ability to influence two-sides or multi-sided platform,which based on the ability of time-spatial integration and the efficiency of time-spacial transformation.This paper discusses the analysis framework based on the game theory method,and discusses the monopoly power of the self-operated retail platform in different market structure.The article concludes that the self-operated retail platform gains monopoly power by controlling the scarcity of purchasing power in the time-spacial range.Under certain conditions it caused the decline in the total social welfare,which result in Matthew Effect where strong ones will become stronger and the weak ones will become weaker.These conditions depend on the market structure of the supply side and the retail platform,the price elasticity of the demand on the consumer side,and the level of fees for the tolls and software service fee.On the aspect of service platform,taking Alibaba retail platform as an example,this paper analyzes monopoly power sources,behavior and influence.The study found that Alibaba with a strong consumer side groups as a bargaining chip,using the very scarce screen resources and consumer attention among the matching of.buyers and sellers,collects promotional fee by auction.This conduct deprived all of supplier's surplus by level 1 price discrimination,but it dose not leads to social welfare dead weight lost.At the end of this paper,the MIMIC model is used to take the Alibaba retail platform as an example to empirical study the monopoly power analysis framework which proposed in this paper.The results show that the framework is effective,and the parameter estimation results can be used to calculate the trend of monopoly power.Calculation shows that Alibaba has monopoly power,but it did not improve significantly on the perspective of time series.This paper focuses on the source,behavior and measurement method of the monopoly power in the online retail platform,constructs the monopoly power analysis framework,gives the influence condition of monopoly power leading to social welfare change,puts forward policy recommendations,and provides important reference for antitrust institution,relevant authorities and related enterprises.