Monopolistic advantages and leadership of ecosystems in the digital era

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Focusing on the ecosystem organized around a large platform firm in the digital era, we examine the following research questions: What are the advantages of ecosystems and how we can measure their performance? Our aim is to understand these questions which have been set aside in prior research. First, we argue that following Pierro Sraffa, monopoly rather than perfect competition is the adequate characterization of the generic environment of ecosystems in the digital era. Then following Stephen Hymer, we argue that good performance of ecosystems can be reflected not in competitive advantage but in monopolistic advantage. We also argue that the members of an ecosystem connecting to a platform behave as if they adopted a joint-profit maximization principle as their objective function. Second, we explain how the business environment of an ecosystem, which is a subset of the generic environment, is neo-Schumpeterian, where both entrepreneurship and routine matter and high uncertainties are inevitable. In our view, ecosystems leadership is about how cooperation among agents connecting to the platform should be stabilized in a neo-Schumpeterian business environment.

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  • Keio business review

    Keio business review 53(2018) 57(1)-75(19),

    Society of Business and Commerce, Keio University

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