Articles

Articles

Dynamic Competition between Global-Local Platforms and the Issues of Domestic-Market-Based Regulation
  • Author
    Sung-Hwan Kim (Ajou University)
  • Year
    2026
  • Volume
    Vol.19
  • Number
    No.1
  • This study examines the characteristics of the competitive structure between global and local platforms and the subsequent impact of platform regulations on such competition, with the concern that domestic-market-based regulations may distort dynamic competitive structures by overestimating the market power of local firms. In the rivalry between global and local platforms, monopolization stemming from economies of scale can be a more significant issue than cross network effects. However, static, domestic-centric regulations tend to overlook the overwhelming capabilities competitiveness of global giants, such as disparities in R&D expenditure. Furthermore, from the perspective of average fixed costs, global platforms hold a structurally advantageous position in dynamic competition. Consequently, the introduction of ex-ante regulations risks exacerbating the gap between global and local players, potentially contributing to the further monopolization of the market by global platforms.
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