Platform Competition for Throughput in Two-sided Freelance Markets

We address the problem of price competition between platforms that facilitate the immediate exchange of services between freelance workers and customers in two-sided markets. We consider two competing platforms that offer identical services to their customers at potentially different prices. The objective of each platform is to maximize its throughput by suitably pricing its services. We assume that customers have a preference or loyalty to the platforms while the workers freelance for the two platforms. Assuming that the resulting interaction between the users is such that their aggregate utility is maximized, we show that for each value of the loyalty, there exists a pure strategy Nash equilibrium and characterize it.