Research on Product Quality, Platform Governance and Government Supervision

Abstract

As an increasingly important form of industrial organization in the new economic era, the platform economy has become an important engine for promoting economic transformation and development. With the development of the platform economy, the monopoly power of platform companies has become stronger and stronger, and more and more problems in the operation of internet platforms have been exposed. What follows is the corporate governance of platforms and the government governance of platform enterprises. The governance intensity of low-quality business by platforms is often lower than the optimal level in society, resulting in damage to consumer rights and social welfare. To clarify the selection incentives and impacts of platform governance strategies, based on the social reality of platform sales of counterfeit products, in the situation where there are both high-quality and low-quality merchants, this paper compares the governance strength of platforms in the oligopoly market and the monopoly market respectively by constructing a game model, and further analyzes the regulatory strategies in different market environments from the perspective of government supervision.By comparing the equilibrium results under different market structures and governance models, this paper finds that the quality difference between the two types of products is the key to determining the governance intensity of platforms. The greater the quality difference, the stronger the platform governance intensity. The difference in the governance intensity of platforms under different market structures depends on network externality and product quality differences: The stronger the network externality and the greater the quality difference, the stronger the governance intensity under the monopoly market; the weaker the network externality and the smaller the quality difference, the stronger the governance intensity under the oligopolistic market. This paper finally analyzes how to regulate platform governance from the perspective of government supervision. Compared with the social optimal, the strength of platform governance is weak, and the increase in network externality and quality differences will further enlarge the gap between the two. Therefore, the intensity of government supervision should be determined according to the market environment, increasing with the increase of network externality and product quality differences.This paper enriches the theoretical exploration of platform economy from the perspective of business governance, and meticulously describes the relationship between governance intensity and network externality as well as business quality. The research conclusions have a certain enlightening effect on the choice of platform self-governance strategies, the choice of government governance intensity, the protection of consumer rights and the promotion of social welfare.