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Two-sided markets and surplus

October 14, 2014

Optimal pricing becomes difficult when one sets of customers determines the market size for a second set of customers. And is crucial to the economics of the internet. A subject Jean Tirole explored.

Does waste build resiliency into our economy? Maybe. I’m skeptical that the waste is where the resiliency is needed. Eating a lot of vegetables inevitably wastes more food than eating packaged foods that have a long shelf-life. Do it anyway.

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