Antitrust, Regulation, and User Union in the Era of Digital Platforms and Big Data

75 Pages Posted: 30 Jun 2022 Last revised: 17 Oct 2022

See all articles by Lin William Cong

Lin William Cong

Cornell University - Samuel Curtis Johnson Graduate School of Management; National Bureau of Economic Research (NBER)

Simon Mayer

HEC Paris

Multiple version iconThere are 2 versions of this paper

Date Written: June 1, 2022

Abstract

We model platform competition with endogenous data generation, collection, and sharing, thereby providing a unifying framework to evaluate data-related regulation and antitrust policies. Data are jointly produced from users' economic activities and platforms' investments in data infrastructure. Data improves service quality, causing a feedback loop that tends to concentrate market power. Dispersed users do not internalize the impact of their data contribution on (i) service quality for other users, (ii) market concentration, and (iii) platforms’ incentives to invest in data infrastructure, causing inefficient over- or under-collection of data. Data sharing proposals, user privacy protections, platform commitments, and markets for data cannot fully address these inefficiencies. We propose and analyze user union, which represents and coordinates users, as an effective solution for antitrust and consumer protection in the digital era.

Keywords: Data Sharing, Data Trust, Digital Economy, Network Effect, Open Banking, Platform Competition, Privacy

JEL Classification: L41,L50

Suggested Citation

Cong, Lin and Mayer, Simon, Antitrust, Regulation, and User Union in the Era of Digital Platforms and Big Data (June 1, 2022). Available at SSRN: https://ssrn.com/abstract=4140083 or http://dx.doi.org/10.2139/ssrn.4140083

Lin Cong (Contact Author)

Cornell University - Samuel Curtis Johnson Graduate School of Management ( email )

Ithaca, NY 14853
United States

HOME PAGE: http://www.linwilliamcong.com/

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Simon Mayer

HEC Paris ( email )

1 rue de la Liberation
Jouy-en-Josas Cedex, 78351
France

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