Abstract

Digital platforms facilitate interactions between consumers and merchants that allow the collection of profiling information which drives innovation and welfare. Private incentives, however, lead to information asymmetries resulting in market failures both on-platform, among merchants, and off-platform, among competing platforms. This paper develops two product differentiation models to study private and social incentives to share information within and between platforms. We show that there is scope for ex-ante regulation of mandatory data sharing that improves social welfare better than competing interventions such as barring entry, break-up, forced divestiture, or limiting recommendation steering. These alternate proposals do not make efficient use of information. We argue that the location of data access matters and develop a regulatory framework that introduces a new data right for platform users, the in-situ data right, which is associated with positive welfare gains. By construction, this right enables effective information sharing, together with its context, without reducing the value created by network effects. It also enables regulatory oversight but limits data privacy leakages. We discuss crucial elements of its implementation in order to achieve innovation-friendly and competitive digital markets.

Paper

The paper can be found here.

Practicalities

This event will be a hybrid event. (Note: Subject to possible change due to COVID-19 government or UvA measures). 
For online attendance, please register via the relevant button below. The Zoom link will be specified in the registration confirmation email upon registration for the event.
Live seminar attendance in person on Roeterseiland campus is also possible: The seminar will take place in REC A building room A3.15. Lunch will be provided. In-person places are limited, cannot be guaranteed and are allocated on a first-come-first-served basis.

About the Speaker

Dr. Georgios Petropoulos is Research Associate at MIT, a digital fellow at Stanford University, and a non-resident fellow at Bruegel. His research focuses on the digital economy, competition policy, and labor economics. He has been a member of the academic high-level expert group of the European Commission providing advice on how we should regulate digital platforms (Digital Markets Act). He has also been an expert advisor of the Hellenic Competition Authority on digital markets, e-commerce, and platform regulation. 

About ACLE

The Amsterdam Center for Law and Economics (ACLE) is a joint initiative of the Faculty of Economics and Business and the Faculty of Law at the University of Amsterdam. The objective of the ACLE is to promote high-quality interdisciplinary research at the intersection between law and economics.