Behavioral Economics, Internet Search, and Antitrust
I/S: A Journal of Law and Policy for the Information Society, Vol. 9 (2014)
29 Pages Posted: 26 Mar 2014 Last revised: 28 Mar 2014
Date Written: 2014
Google dominates on-line search in Europe and the United States. The search engine has faced a continuing inquiry by the European Commission for anticompetitive conduct, and the Federal Trade Commission (FTC) has recently concluded an investigation that left key questions unanswered.
Drawing on behavioral economics, the Article proposes that internet search services with dominant positions can strategically select and promote co-owned services to increase consumers’ costs of switching to alternative services, i.e., Google’s placement of popular links, such as YouTube and Google Maps, on its launch page. Relying on Daniel Kahneman’s division of the control mechanisms of human action between the automatic, intuitive, and habitual (“System One”) and the effortful, deliberate, conscious (“System Two”), the Article suggests that consumers can reduce online navigation costs by placing their most frequently used services on their launch place. This effect might have greatest impact if the linked sites are frequently used internet services — like YouTube or Google books. The Article concludes by suggesting possible remedies and analyzing First Amendment concerns.
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