Tim Wu ‘Blind Spot: The Attention Economy and the Law’ (2017) Concurrences

This paper – which can be found here – seeks to address an imbalance: while it “has become commonplace, especially in the media and technology industries, to speak of an “attention economy” and of competition in “attention markets” (…)the study of “attention markets” has only very recently become of interest to legal scholars, and only in connection with specific cases (…)”. This paper is “an effort to close that gap, and show why a better understanding of attentional markets will be critical to addressing pressing legal issues, such as antitrust’s treatment of the high technology industry and emerging public policy questions surrounding the “theft” of attention from captive audiences.” The fulcrum of the analysis is the “attention broker” – someone who “attracts attention by offering something to the public and then reselling that attention to advertisers for cash”, such as Google, Facebook or, more prosaically, TV channels and free subway newspapers. The author contends that the concept of “Attention Brokers”…

Jens Prufer and Christoph Schottmüller ‘Competition with Big Data’ CentER Discussion Paper 2017-007

This working paper – which can be found here – attempts “to better understand data-driven markets: i.e. markets where the cost of quality production is decreasing in the amount of machine-generated data about user preferences or characteristics (henceforth: user information), which is an inseparable by-product of using services offered in such markets”. The authors start from the assumption that data-driven markets are characterized by imperfect competition and subject to indirect network effects. In the light of this, they try to determine: (a) under which conditions a duopoly can be a stable market structure in a data-driven market; (b) when the propensity to market tipping (i.e. to monopolization) becomes overpowering; (c) the conditions that allow a dominant company in one data-driven market to leverage its position into another market. The paper begins, at least implicitly, by distinguishing between indirect network effects (which mix supply and demand effects. They occur where increased demand leads to decreasing costs in obtaining a product input – in…

Giuseppe Colangelo and Mariateresa Maggiolino ‘Data Protection in Attention Markets: Protecting Privacy through Competition?’ (2017) 8(6) 363

This paper – which you can find here – asks whether it is possible to protect privacy through competition. The paper begins from the observation that we are witnessing the advent of many businesses dedicated to offer zero-price services in exchange for advertising revenues and data. While not completely new – old media companies had similar business models –, these new businesses benefit from “new” digital technologies to collect, store and analyse huge amounts of users’ data. Thus, it is unsurprising that user data are now conceptualized as the currency for the many services and products that users find on the Internet at zero-price. Given this, the question the authors seek to address is “whether and how EU competition law could be enforced as a substitute of EU data protection law.” At this point, I must ask you to moderate your screams of “sacrilege”, appropriate as they may be for the festive season, and give the article a chance. The paper and its…

Wolfgang Kerber ‘Digital markets, data, and privacy: competition law, consumer law and data protection'(2016) Journal of Intellectual Property Law & Practice 11(11) 856

This is a paper on the economics of privacy that focuses more specifically on the role of privacy in competition law assessments. It can be found here. The paper claims that it is not sufficient to design policy solutions focused on a single field of the law, e.g. competition law or data protection law. Rather, an integrated approach that takes into account different regulatory perspectives is necessary. This paper identifies competition policy, consumer policy, and data protection policy as the three main regulatory perspectives that must be taken into account in order to adequately address privacy concerns. Each area of the law is reviewed in turn, from an economic perspective, in an attempt to discern how policies might remedy market failures concerning privacy rights and how a more integrated regulatory approach can be developed. The paper is structured as follows: Section II provides a brief overview of the economics of privacy. It begins by noting (in line with the article…

Alessandro Acquisti, Curtis Taylor, and Liad Wagman ‘The Economics of Privacy’ (2016) Journal of Economic Literature 54(2) 442

This article – which can be found here – summarises theoretical and empirical research on the economics of privacy. It focuses on the economic value and consequences of protecting and disclosing personal information, and on consumers’ understanding and decisions regarding the trade-offs associated with the privacy and the sharing of personal data. Their starting point is that the economics of privacy is a branch of information economics. Economists’ interest in privacy has primarily focused on its informational dimension: the trade-offs arising from protecting or sharing of personal data. At its core, the economics of privacy concerns the trade-offs associated with the balancing of public and private spheres between individuals, organizations, and governments. In this regard, the authors identify a number of important characteristics of privacy and personal information as economic goods: First, the value of keeping some personal information protected, and the value of it being known, are almost entirely context-dependent and contingent on essentially uncertain combinations of states of…

Darren S. Tucker ‘The Proper Role of Privacy in Merger Review’ CPI Antitrust Chronicle May 2015 (2)

This is  a (short) paper on the proper role of privacy in merger review, which can be found here. While focusing mainly on the US (where there have “been increasing calls for the Federal Trade Commission (“FTC”) and U.S. Department of Justice (“DOJ”) to consider the potential loss of consumer privacy as a factor in their merger reviews and to challenge mergers of firms with large stores of personal data that otherwise pose no apparent competitive issues”), it could be read more generally. The argument in this paper is quite straightforward: the law is clear that non-competition factors – such as standalone consumer concerns – cannot be considered in antitrust analysis. Further, the law seems to be on sound policy grounds. The paper begins by arguing that there are good reasons why privacy should not be applied as a competitive parameter. First, there are a variety of concepts of privacy, and it is unclear which one should be applied. Secondly,…

William Kovacic and Marianela Lopez-Galdos ‘The Lifecycles of Competition Systems : Explaining Variation in the Implementation of New Regimes’ (2016) 79 Law and Contemporary Problems 85

Starting from the observation that, over the last 30 years, antitrust / competition law has had a rate of adoption across the world almost without parallel in the history of economic regulation, this article – which can be found here – examines one particular aspect of the global adoption of  competition law systems: what jurisdictions must do to build the institutions needed for effective competition law implementation, and in particular, to develop programs that improve economic performance. The underlying assumption is that “improvements in institutional arrangements [i.e. institutional design and policy implementation] tend to yield superior policy outcomes.” The article is structured as follows: Part II sets out the major assumptions that underpin the theory outlined in the article. These assumptions are based on “a large and growing body of literature on the development of new competition law systems”, on “a benchmarking project undertaken by the George Washington [which] has collected information about ten major institutional characteristics for the world’s 130 competition…

Alison Jones ‘ Antitrust Appraisal of Vertical Agreements in the ASEAN Economic Community’ in Ong (ed.) The Regionalisation of Competition Law and Policy within the ASEAN Economic Community (2018, CUP)

This paper – which you can find here – looks at the different approaches to vertical agreements across ASEAN. The paper draws on practice and experience in the US and EU to consider whether, and if so how, the approach to vertical agreements under the competition law systems of ASEAN countries should be changed in order to ensure a more coherent policy across the region. Following an introduction, Section 2 examines how divergent national policies towards vertical agreements in ASEAN might be damaging competition, efficiency and market integration, and why greater convergence around a harmonised framework might be desirable. It begins by reviewing the outlines of the ASEAN single market and by assessing the role of competition law for its development. It devotes particular attention to the treatment of vertical agreements, which are subject to a spectrum of radically different approaches across the region – from only vertical agreements by dominant companies being subject to competition law in Singapore and…

A. Douglas Melamed ‘Antitrust Law is Not That Complicated’ (2017) Harvard Law Review 130(2) 163

This paper – which can be found here – is a reaction to Louis Kaplow’s article “On the relevance of market power” which I discussed here. It provides a much better summary of Kaplow’s article than what I managed to write then, and also a very apt critique of that paper. As such, I think it would be useful if I were to provide you with a summary of this piece. While seemingly agreeing with the conceptual framework developed by Kaplow, the author (a professor at Stanford) shares some of my critiques (which makes me feel rather relieved, because it means I understood at least parts of Kaplow’s paper). Like me, he reads Kaplow’s paper as implicitly assuming that competition law is ultimately a broad standard directed at maximising economic welfare on each situation. This standard is applied as follows: conduct that reduces economic welfare is unlawful, and conduct that increases economic welfare is lawful. Hence, market power is not really…

Edward B. Rock and Daniel L. Rubinfeld ‘Defusing the Antitrust Threat to Institutional Investor Involvement in Corporate Governance’

This paper – available here – criticises arguments for increased antitrust intervention against institutional investors. The paper begins by identifying its target: “a line of new economics research that claims to show theoretically and empirically that concentration of shareholdings in the hands of diversified investors has substantial anti-competitive effects in concentrated markets”, and subsequent legal scholarship that interprets this economic research to mean that the practices of institutional investors infringe competition law, or should, in any event, be subject antitrust rules. The first half of the paper develops a number of methodological criticisms of existing theoretical and empirical analyses of the portfolio strategies adopted by institutional investors. These criticisms are said to put in doubt a number of conclusions regarding the extent to which common ownership makes a difference to competition in the market – and, by extension, the justifications for antitrust intervention against institutional investors. Part II then analyses the legal implications of the economic evidence, and concludes that holdings by diversified…