BCCP Conference and Policy Forum 2017 - Algorithms and Consumer Targeting

Digital markets are characterized by consumer targeting and customization of products and services. Firms such as Amazon or Google use algorithms to increase their product quality, such as search results or the targeting of advertising. These algorithms rely on past consumer search and browsing behavior to learn and improve results in real-time. This session discusses the extent to which the use of algorithms could harm consumers by behavioral discrimination, where firms track and profile consumers to recover their willingness to pay for particular goods and services, or by sophisticated data-driven price algorithms facilitating collusion. A large controversy in the use of algorithms is the extent they could lead to bias – not only in the things we buy but also in the news and entertainment we receive – in ways which may be against the interests of society. This panel will also discuss what potential sources of bias there may be and the extent to which intervention by consumer protection or competition authorities might be warranted.