The tremendous growth of digital transactions –mainly through online platforms— has profoundly affected the way we interact, opening vast opportunities to improve our lives. Consumers have benefited from an unprecedented proliferation of new services and products that previously were simply too costly to be developed and marketed to customers. At the same time, network effects in platform business models have brought market power concerns back to the front stage.
This year’s conference focusses on the rise of corporate power with an emphasis on digital markets. A remarkable body of economic research reports the global rise of mark-ups across many markets and industries. The measurement of market power, the role of competition policy, and the potential need for regulatory intervention are core issues in the current academic and policy discussion. These issues are particularly challenging in multi-sided digital platform industries with large players like Amazon, Facebook, and Google, which are also under suspicion of increasing political power and influence. This conference brings together leading academics and policy makers to discuss the road ahead for improving institutions and markets to curb corporate power for the good of society.
Recent academic work documents the global rise of concentration, profits, mark-ups, and market power across many markets and industries since the 1980s. In the digital economy, in particular, large platforms have secured substantial and persistent advantages over smaller players due to network effects, the large-scale collection of customer data, and sophisticated pricing algorithms. What are the possible explanations for rising mark-ups and increasing concentration? What are the distributional implications of this broad rise in market power? What is the role of competition policy enforcement in protecting consumers from monopoly, monopsony, and market power more generally? Should regulators be worried about rising mark-ups across the economy and is there room for more regulatory intervention? Is the law falling behind technology in the sense that it is unable to detect business practices harming competition on big online platforms?
Research Professor of Law, American University
Professor of Economics, Universitat Pompeu Fabra Barcelona
Fiona Scott Morton
Theodore Nierenberg Professor of Economics, Yale University
Moderated by Tomaso Duso (Head of the Firms and Markets Department, DIW Berlin and Professor of Empirical Industrial Economics, Technische Universität Berlin)
This session highlights how the economic market power of digital and social media platforms, such as Google and Facebook, can also lead to political power and influence as these large platforms are increasingly primary sources of news and information for consumers. How can social media shape political agendas, political mobilization, and collective action? How can the Internet and social media platforms, in particular, affect election outcomes? Is misinformation and political polarization on social media platforms damaging societies and democratic institutions?
Moderated by Daniela Stockmann (Professor of Digital Governance, Hertie School of Governance)
This policy roundtable brings together the topics of the previous two academic sessions and discusses the connection between rising market power, increasing political influence of digital and social media platforms, as well as the related importance of user data, data security, and data protection law. Is existing consumer protection law adequate for addressing concerns arising on online platforms? Are existing regulations sufficient to address the particular policy concerns arising in these markets? Has there been a lack of competition enforcement in the past resulting in the rise of mark-ups and concentration? What is the future role of consumer and competition policy? How can the peculiarities of digital markets, such as network effects and big data, be taken into account?
Professor of Competition Policy, University of East Anglia
Research Centre Member, Centre for Competition Policy
State Data Protection Officer for Schleswig-Holstein
Chief Data and Digital Insights Officer, UK Competition & Markets Authority
Principal Advisor in Directorate-General Justice and Consumers of the European Commission
Moderated by Hans W. Friederiszick (Managing Director, E.CA Economics and Research Fellow, European School of Management and Technology (ESMT))