Disruptive Innovation and Implications for Competition Policy

21 Pages Posted: 13 Sep 2018

Date Written: 2018

Abstract

While competition is good for consumers and economies, competition rules alone cannot necessarily produce adequate outcomes for all circumstances. Other norms, particularly regulatory norms, are also often likely to be relevant. The current legal and policy debates about ‘disruptive innovation’ highlight the need for a healthy mixture of competition and regulation. This paper offers a series of reflections arising from the challenges posed by disruptive products, services and business models. These reflections cover matters such as the capacity of legal procedures to keep pace with rapidly changing market environments. Competition advocacy can help regulators decide controversial points. The paper discusses several sectors, such as the car-riding and overnight sleeping sectors, in which different interests must simultaneously be accommodated within the boundaries of national tradition and European Union law. As discussed, some of these matters have now been adjudicated by the EU Courts. The related subjects of the acquisition of data as well as the requirements of privacy and data protection principles are also considered. The paper reflects on the role of network effects and on the difficult choices to be made with regard to the wisdom of relying on competition law or on the nature of innovation itself to deliver appropriate responses to the growth of network-based economic power; and the paper notes but does not suggest a remedy for the problem of delay as inimical to effective judicial review.

Keywords: Competition law; Disruptive innovation; Regulation of disruptive products and services; Big data; Internet privacy

Suggested Citation

Forrester, Ian S., Disruptive Innovation and Implications for Competition Policy (2018). EUI Department of Law Research Paper No. 2018/14, Available at SSRN: https://ssrn.com/abstract=3248176 or http://dx.doi.org/10.2139/ssrn.3248176

Ian S. Forrester (Contact Author)

University of Glasgow ( email )

Adam Smith Business School
Glasgow, Scotland G12 8LE
United Kingdom

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