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Home arrow Communication arrow How Digital Communication Technology Shapes Markets: Redefining Competition, Building Cooperation

Notes

  • 1. See [20, Chap. 16] for a classic analysis of the determinants of economic organizations: coordination and incentives.
  • 2. As Eric Schmidt and Jared Cohen succinctly write, “On the world stage, the most significant impact of the spread of communication technologies will be the way they help reallocate the concentration of power away from states and institutions and transfer it to individuals” [27].
  • 3. Real estate brokers are intermediaries or active participants in the marketplace for homes, while online sites like Craigslist are platforms. While community moderated, they are free of any active engagement, as signified by their .org domain which symbolizes their non-commercial, public service mission.
  • 4. An analogy to the marriage market is useful. A successful computer engineer based in California on a short holiday to his hometown in India might find it advantageous to hire multiple marriage brokers to increase his chances of returning married. By hiring a single broker, the unfortunate bachelor might be stuck with the one intermediary who has no acceptable female clients.
  • 5. There is some skepticism about user-generated feedback. “There was a lot of fatigue around user-generated rabble that was dominating food dialogue online,” Rich Maggiotto, chief executive of Chefs Feed, [a new app], said... “I am certainly more inclined to trust a chef with a name (and a reputation to guard) than the anonymous grouch who give a great cafe a low rating after having to wait five minutes for a table” [32].
  • 6. A business establishment is a single physical unit, while a firm can consist of multiple such units.
  • 7. Antonio Martinez [41] gives a fascinating account of tech startups. When his startup, AdGrok, was acquired by Twitter in 2011, only the software engineers were part of the acquisition. The CEO, Martinez, joined Facebook, but quit after a few years. It would seem that a startup is then simply a resume, listing the accomplishments of various employees, to be used in capturing the big ticket jobs.
 
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