International Coherence in Digital Platform Regulation: An Economic Perspective on the US and EU Proposals

29 Pages Posted: 27 Oct 2021

See all articles by Monika Schnitzer

Monika Schnitzer

Ludwig Maximilian University of Munich (LMU)

Jacques Crémer

University of Toulouse 1 - Toulouse School of Economics (TSE)

Gregory S. Crawford

University of Zurich - Department of Economics

David Dinielli

Yale - Tobin Center for Economic Policy

Amelia Fletcher

Centre for Competition Policy and Norwich Business School, UEA

Paul Heidhues

Heinrich Heine University Dusseldorf

Fiona M. Scott Morton

Yale School of Management; National Bureau of Economic Research (NBER)

Katja Seim

Yale School of Management

Date Written: August 9, 2021

Abstract

There is broad international consensus that ex ante regulation is needed to address the market dominance of the very largest digital platforms and that there are benefits to having broadly coherent regulatory approaches across jurisdictions. Regulation in any one jurisdiction will have extra-territorial effects, and inconsistent regulation will create unnecessary costs, reduce service quality, and dampen innovation. Greater coherency in the regulation of digital markets should make regulation more effective, more proportionate, and better able to limit any negative consequences. This article considers current US and EU proposals. We compare and contrast these two proposals through an economic lens, with a focus on substance rather than legal process and enforcement. We find substantial similarity of intent and approach between the US and EU proposals but also some important divergences, which highlight areas for further consideration by the EU and the US. We note in particular that the EU proposal does not include a provision analogous to a US proposal for strengthening the merger test applicable to acquisitions by large platforms, but that it should. More generally, the more the two sets of proposals can learn from each other, the better and more coherent the final regulations are likely to be.

Suggested Citation

Schnitzer, Monika and Crémer, Jacques and Crawford, Gregory S. and Dinielli, David and Fletcher, Amelia and Heidhues, Paul and Scott Morton, Fiona M. and Seim, Katja, International Coherence in Digital Platform Regulation: An Economic Perspective on the US and EU Proposals (August 9, 2021). Available at SSRN: https://ssrn.com/abstract=3923604 or http://dx.doi.org/10.2139/ssrn.3923604

Monika Schnitzer (Contact Author)

Ludwig Maximilian University of Munich (LMU) ( email )

Geschwister-Scholl-Platz 1
Munich, DE Bavaria 80539
Germany

Jacques Crémer

University of Toulouse 1 - Toulouse School of Economics (TSE) ( email )

Place Anatole-France
Toulouse Cedex, F-31042
France

Gregory S. Crawford

University of Zurich - Department of Economics ( email )

Schönberggasse 1
Zürich, CH-8001
Switzerland

HOME PAGE: http://www.econ.uzh.ch/faculty/groupcrawford.html

David Dinielli

Yale - Tobin Center for Economic Policy ( email )

New Haven, CT 06520
United States

Amelia Fletcher

Centre for Competition Policy and Norwich Business School, UEA ( email )

Norwich
United Kingdom

HOME PAGE: http://https://people.uea.ac.uk/amelia_fletcher

Paul Heidhues

Heinrich Heine University Dusseldorf

Universitätsstrasse 1
Duesseldorf, DE NRW 40225
Germany

Fiona M. Scott Morton

Yale School of Management ( email )

New Haven, CT 06520
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Katja Seim

Yale School of Management ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
306
Abstract Views
786
rank
140,433
PlumX Metrics