Research interests: platform ecosystems, corporate strategy, resources, firm scope, interdependencies

Chung, H.D., Y.M. Zhou, Ethiraj, S. (2024). “Platform Governance in the Presence of Within-Complementor Interdependencies: Evidence from the Rideshare Industry” Management Science, 70(2):799-814.
– Link (print / preprint)

Existing studies suggest that platform access restrictions may cause restricted complementors to switch to competing platforms, which will increase complement quantity on competing platforms. We re-examine this prediction by accounting for the impact of economies of scope on complementor responses to platform access restriction. We argue that restricting a complementor’s access on a platform may prevent it from achieving economies of scope from multi-homing, thereby incentivizing it to abandon both the restricted and (unrestricted) competing platforms. Using rideshare data in New York City, we compare the numbers of trips made by Lyft and Uber drivers, respectively, before and after Lyft restricted drivers’ access on its platform. We find that Lyft’s access restriction reduced trip numbers not only on the Lyft platform but also on the Uber platform. In addition, both Lyft’s and Uber’s trip numbers decreased not only during the restricted low-demand periods (e.g., non-rush hours) but also during the unrestricted high-demand periods (e.g., rush hours). These results highlight the importance of accounting for interdependencies across complementor activities when designing platform governance policies.

Chung, H.D., Y.M. Zhou, Choi, C. “When Uber Eats Its Own Business, and Its Competitors’ Too: Resource Exclusivity, Oscillation, and Cannibalization Following Platform Diversification” (Revise and Resubmit, Strategic Management Journal)
– Link

How will a platform firm’s diversification affect its existing business? While platform diversification enables complementors to share some of their resources across businesses, it may also create opportunities for complementors to reallocate other complementary resources to maximize utilization, thereby hurting the platform firm’s existing business. In addition, such sharing-enabled resource reallocation may divert complementors away from competing platform firms. Using Uber’s diversification into the food delivery business as a localized shock, we analyze changes in the rideshare business in Manhattan, New York City, after Uber launched Uber Eats in the city. We find that the proportion of restaurants that joined Uber Eats was associated with a reduction in trip volumes for both Uber and Lyft in Manhattan. The negative impacts were weakened during rush hours, when the opportunity costs of resource reallocation to Uber Eats were higher for rideshare drivers. Several mechanism tests (e.g., placebo tests using taxi trips or the launch of DoorDash) confirmed that the results were driven by drivers reallocating their driving time to the food delivery business.

Chung, H.D. “Post-mates No More? Complementor Engagement Following Platform Acquisition” (Working paper)

How does a platform acquisition influence complementors on the target platform? The acquisition increases the number of users on the merged platform and provides complementors with stronger network effects. However, not all complementors may benefit from the enlarged user base. I argue that complementors on the target platform incur adjustment costs after the acquisition, which leads to a competitive disadvantage in attracting users relative to complementors on the acquiring platform. The competitive disadvantage may escalate with the number of complementors on the acquiring platform and force complementors on the target platform to leave the merged platform. I empirically test these arguments using Uber Eats’ acquisition of Postmates in the U.S. food delivery industry. I find that Postmates restaurants were more likely to leave Uber Eats and switch to competing platforms (i.e., DoorDash or Grubhub) in cities where Uber Eats had a relatively larger number of restaurants before the acquisition. This effect was weaker for Postmates restaurants that also operated on Uber Eats before the acquisition and stronger for Postmates restaurants that also operated on competing platforms before the acquisition.

Chung, H.D. “When Taxis Collide with Uber: Non-Platform Incumbents’ Responses to Platform Entry” (Working paper)

How do non-platform incumbents respond to a platform entrant? I investigate how taxi drivers respond to the increased presence of Uber by using data on over a billion trips made by taxi and Uber drivers in New York City between 2015 and 2019. I find that, as Uber trip volumes increased in a specific geographic area, taxi drivers in the given area increased their working hours, but the increased workload hurt their service quality. Specifically, drivers were involved in more vehicle collisions, and received more complaints and smaller tips from customers. However, these responses were weaker for taxi drivers who leased taxicabs due to higher coordination costs (e.g., joint scheduling with other drivers). My results hold when I employed an instrumental variables approach using the license cap regulation in NYC. These findings highlight the non-pricing responses of non-platform incumbents against a platform entrant.

Chung, H.D., Song, J. “R&D Collaboration and Exploration in Multinational Corporations” (Working paper)

This paper examines the relationship between internal R&D collaboration and subsidiary exploration in multinational corporations (MNCs). We argue that R&D collaboration within MNCs will decrease subsidiary exploration by strengthening subsidiaries’ internal embeddedness. We tested our hypotheses using patent data of major semiconductor firms from 1989 to 2008. The results suggest that subsidiaries are less likely to explore technologies that are new to MNCs when internal collaboration increases. In addition, this effect is strengthened when headquarters have higher technological capability but is weakened when R&D collaboration with local partners in the host country increases.