Disruptive Innovation

12 Pages Posted: 3 Jul 2015

See all articles by Jeremy K. West

Jeremy K. West

Organisation for Economic Co-Operation and Development (OECD), Directorate for Science, Technology and Innovation; OECD Competition Division

Date Written: May 28, 2015

Abstract

Disruptive technologies and business models profoundly affect existing markets. The most visible recent examples are Internet-based "sharing services" that are disrupting conventional taxi and hotel markets, but there are many others in diverse areas such as finance, retail electricity and automobiles.

Disruptive innovations can deliver important benefits to consumers and can stimulate innovation and price competition from established providers. However, they can also give rise to legitimate public policy concerns (e.g. safety, privacy) and create demands for regulation. Established providers will often lobby for existing regulations to be applied to new providers to lessen their competitive advantage, sometimes claiming rightly or wrongly that this advantage arises from an ‘unfair’ exclusion from regulatory rules.

But how far should regulation go, what role should competition policy play in these debates, and how might competition authorities participate?

This issues paper served as the backdrop for a June 2015 hearing held by the OECD's Competition Committee, in which experts and delegates discussed current competition policy challenges arising from disruptive innovations.

Keywords: disruption, disruptive, innovation, regulation, sharing economy, competition

JEL Classification: D21 ,K21, K23, L4, L5

Suggested Citation

West, Jeremy K., Disruptive Innovation (May 28, 2015). Available at SSRN: https://ssrn.com/abstract=2625531 or http://dx.doi.org/10.2139/ssrn.2625531

Jeremy K. West (Contact Author)

Organisation for Economic Co-Operation and Development (OECD), Directorate for Science, Technology and Innovation ( email )

2 rue Andre Pascal
Paris Cedex 16, 75775
France

OECD Competition Division ( email )

2, rue Andre Pascal
Paris Cedex 16, F-75775
France

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