Algorithmic Information Disclosure by Regulators and Competition Authorities

Abstract

Also in the digital age, markets work properly as long as consumers are well informed. What is peculiar of the digital age is that consumers have become very fragile, also because firms can extensively manipulate the information that they produce and distribute to markets. Antitrust authorities may find their way to prosecute business manipulative conduct, as some rulings suggest. However, the enforcement of antitrust law is subject to precise circumstances and requires cumbersome proceedings, especially when dominant firms are involved. Therefore, a simpler and more widespread intervention is needed. Although over the years traditional disclosure regulation has showed its limits, today algorithmic analysis gives room to more effective forms of disclosure regulation. Therefore, the paper maintains that both regulators and antitrust authorities can use these new forms of disclosure regulation to perform better their functions. Thanks to algorithmic analysis, (a) regulators can provide consumers with targeted co-regulated disclosures; (b) while competition authorities, using their advocacy powers, can provide trustworthy rankings and reviews about firms’ ability to comply with antitrust and consumer protection laws.

Keywords: information disclosure, antitrust, co-regulation, information asymmetry, big data, digital markets, proportionality, algorithms

JEL Classification: K21, L15, L50, D80