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Language, Internet and Platform Competition

Authors
  • Jeon, Doh-Shin
  • Jullien, Bruno
  • Klimenko, Mikhail
Publication Date
Jan 01, 2021
Source
HAL
Keywords
Language
English
License
Unknown
External links

Abstract

The dominance of English language content on the Internet raises a question ofhow consumer bilingualism in a given country a§ects the amount of home languagecontent and the countryís welfare. We address this question by studying two-sidedmarket competition between a foreign and a domestic content distribution platformin a small open economy. On the one hand, bilingualism has the beneÖt of increasingcross-side network externalities by increasing consumer concentration on the foreignplatform, which increases the amount of home language content. On the other hand,bilingualism exposes home language content to competition from foreign languagecontent and softens platform competition, which reduces the amount of home language content. We Önd that bilingualism mostly increases consumer surplus but canreduce domestic producer surplus. The welfare e§ect of taxing the foreign platformis also analyzed.

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