Do Dual-Role Platforms Benefit Consumers? Evidence from Amazon

Digital platforms like Amazon serve as both retailers and intermediaries for third-party sellers. This paper examines whether this dual role is beneficial for consumers by analyzing Amazon's Buy Box, which determines sellers' visibility. We develop a conceptual framework that links Amazon's dual participation to cost efficiency, demand, and competition, and also show how outsourcing Amazon's logistics to third-party sellers affects these market outcomes. Using highfrequency, product-level panel data on beverages from Amazon's marketplaces in the United Kingdom and the United States, we estimate fixed-effects models to examine how variation in Buy Box ownership across products ultimately affects consumer welfare. Our findings indicate that Amazon's presence reduces prices and increases sales, generating approximately $12 billion in annual consumer surplus. Furthermore, outsourcing Amazon's logistics to third-party sellers generates an additional consumer surplus of about $1.7 billion.