Virtual Competition: The Promise and Perils of the Algorithm-Driven Economy

Ariel Ezrachi (Author) Maurice E. Stucke (Author)
Available

Description

"A fascinating book about how platform internet companies (Amazon, Facebook, and so on) are changing the norms of economic competition."
--Fast Company

Shoppers with a bargain-hunting impulse and internet access can find a universe of products at their fingertips. But is there a dark side to internet commerce? This thought-provoking exposé invites us to explore how sophisticated algorithms and data-crunching are changing the nature of market competition, and not always for the better. Introducing into the policy lexicon terms such as algorithmic collusion, behavioral discrimination, and super-platforms, Ariel Ezrachi and Maurice E. Stucke explore the resulting impact on competition, our democratic ideals, our wallets, and our well-being.

"We owe the authors our deep gratitude for anticipating and explaining the consequences of living in a world in which black boxes collude and leave no trails behind. They make it clear that in a world of big data and algorithmic pricing, consumers are outgunned and antitrust laws are outdated, especially in the United States."
--Science

"A convincing argument that there can be a darker side to the growth of digital commerce. The replacement of the invisible hand of competition by the digitized hand of internet commerce can give rise to anticompetitive behavior that the competition authorities are ill equipped to deal with."
--Burton G. Malkiel, Wall Street Journal

"A convincing case for the need to rethink competition law to cope with algorithmic capitalism's potential for malfeasance."
--John Naughton, The Observer

Product Details

Price
$18.95
Publisher
Harvard University Press
Publish Date
October 29, 2019
Pages
368
Dimensions
5.4 X 1.0 X 8.2 inches | 0.7 pounds
Language
English
Type
Paperback
EAN/UPC
9780674241589

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About the Author

Ariel Ezrachi is the Slaughter and May Professor of Competition Law and a Fellow of Pembroke College, Oxford. He serves as the Director of the University of Oxford Centre for Competition Law and Policy. He is co-editor-in-chief of the Journal of Antitrust Enforcement (OUP) and the author, co-author, editor and co-editor of numerous books, including Virtual Competition - The Promise and Perils of the Algorithm Driven Economy (2016, Harvard), EU Competition Law - An Analytical Guide to the Leading Cases (6th ed, 2018, Hart), Global Antitrust Compliance Handbook (2014, OUP), Research Handbook on International Competition Law (2012 EE), Intellectual Property and Competition Law: New Frontiers (2011, OUP), Criminalising Cartels: Critical Studies of an International Regulatory Movement (2011, Hart), Article 82 EC - Reflections on its recent evolution (2009, Hart) and Private Labels, Brands and Competition Policy (2009, OUP).His research and commentary have been featured in The Economist, The New Yorker, Wall Street Journal, Financial Times, The Guardian (opinion), The Guardian, Nikkei, Times Higher Education, Harvard Business Review, HBR (2), Berkeley Technology Law Journal, Chicago University Pro Market, New Scientist, Politico, OBLB, WIRED, Click - BBC, CPI, Concurrences, The Scotsman, The Times, Fast Company, Nesta, UNCTAD, OECD, Forbes, Factor, The Australian, NRC 2016, NRC 2018, Business Insider, CMS Wire, Cited, IAI, Les Echos, ACCC, ZDnet, and other international outlets. His work on algorithmic collusion (together with Prof Stucke) has been central to policy discussions in international organisations and competition agencies (including, among others, the CMA, OECD, UN, House of Lords, Monopolkommission).Prof. Ezrachi develops training and capacity building programmes in competition law and policy for the private and public sectors, including training programmes for European judges endorsed and subsidised by the European Commission. He is an Academic Advisor to the European Consumer Organisation - BEUC, member of the Independent Committee on Digital Platforms, member of UNCTAD Research Partnership Platform, and a former Non-Governmental Advisor to the ICN.

Maurice E. Stucke is a co-founder of the Data Competition Institute, a law professor at the University of Tennessee, and of counsel at the Konkurrenz Group. Professor Stucke publishes and speaks regularly on competition policy in the United States, Europe, and Asia. Professor Stucke serves as one of the United States' non-governmental advisors to the International Competition Network, as a Senior Fellow at the American Antitrust Institute, where he chaired a committee on the media industry that drafted a transition report for the incoming Obama administration, on the board of the Academic Society for Competition Law, and on advisory board of the Institute for Consumer Antitrust Studies. Professor Stucke received a number of awards including a Fulbright fellowship to teach at the China University of Political Science and Law in Beijing, and the Jerry S. Cohen Memorial Fund Writing Award for his article "Behavioral Economists at the Gate: Antitrust in the Twenty-First Century." He has twenty years experience handling a range of competition policy issues in both private practice and as a prosecutor at the U.S. Department of Justice.

Reviews

[Ezrachi and Stucke] make a convincing argument that there can be a darker side to the growth of digital commerce. The replacement of the invisible hand of competition by the digitized hand of internet commerce can give rise to anticompetitive behavior that the competition authorities are ill equipped to deal with...Virtual Competition displays a deep understanding of the internet world and is outstandingly researched.-- (11/14/2016)
Traditional competition law is about firms and their activities. The great insight underpinning Ezrachi's and Stucke's book is that, in a digital world, competition law will be mostly about algorithms and big data because these are the forces that now determine what happens in online marketplaces. The book focuses on three particular areas in which anticompetitive and manipulative behavior is possible and, in some cases, already evident... Ezrachi and Stucke dig deep into the ways in which algorithmic and big-data analytics combine to produce behaviors and outcomes that are--or could be--troubling for society. They then go on to discuss the extent to which existing competition law and legal precedents may--or may not--be able to address abuses... Ezrachi and Stucke have made a convincing case for the need to rethink competition law to cope with algorithmic capitalism's potential for malfeasance.-- (12/04/2016)
We owe the authors our deep gratitude for anticipating and explaining the consequences of living in a world in which black boxes collude and leave no trails behind. They make it clear that in a world of big data and algorithmic pricing, consumers are outgunned and antitrust laws are outdated, especially in the United States...We can hope the ideas discussed in Virtual Competition get on the political agenda.-- (11/04/2016)
A fascinating book about how platform internet companies (Amazon, Facebook, and so on) are changing the norms of economic competition. Virtual Competition: The Promise and Perils of the Algorithm-Driven Economy argues that these companies, with their immense data advantage, are effectively making their own rules in the marketplace, beating back new market entrants, and disadvantaging customers.-- (08/04/2017)
This highly readable and authoritative account sets out the ways that platforms have replaced the invisible hand with a digitized one--a hand that is human-engineered, subject to corporate control and manipulation, and prone to charges of unlawfulness...It is becoming increasingly apparent that widespread deployment of algorithmic tools can intensify, rather than reduce, the chasm between the wealthy and the vulnerable. This is the issue Ezrachi and Stucke address as behavioral discrimination...Overall, they argue, this is corrosive to social welfare, because the more vulnerable among us end up paying more. The authors' assessment of where this is heading is of the most sober kind: absent legal intervention, perfect discrimination will likely become the new norm.-- (01/05/2017)
This is a groundbreaking, critical work--a major contribution to the field of competition law.--Frank Pasquale, author of The Black Box Society
Ezrachi and Stucke provide a compelling analysis challenging the orthodoxy that modern technology empowers consumers. Their findings will send a shiver down the spine of consumers, businesses, public policy makers and anyone working in the competition field. Virtual Competition is a fast-paced, mind-boggling thriller that you can't put down; a thriller in which we are all set to be the victim.--Alan Giles, Saïd Business School, University of Oxford
Virtual Competition provides an intriguing and provocative look at the potential dark side of big data and big analytics. The debate over digital competition is just beginning, and Ezrachi and Stucke have laid down a marker that is likely to capture wide attention.--Jonathan Levin, Stanford Graduate School of Business
Ezrachi and Stucke's insights into data-driven opportunities, collusion scenarios, discrimination, and 'frenemies' will help authorities distinguish between true efficiencies and anti-competitive problems, and ensure that most enforcement at least keeps up with technological developments. Forward-thinking competition authorities can use these insights proactively to help craft government policies that ensure that innovation and competition are real, while problems are addressed quickly and thus--hopefully--remain virtual.--Philip Marsden, Inquiry Chair, Competition and Markets Authority
A thought-provoking, clearly written examination of the coming effects on markets and competition of computer algorithms, big data, big analytics, and 'super-platforms, ' drawing on real-life examples, on neoclassical and behavioral economics, and on the authors' deep understanding of U.S. and EU competition law.--Harry First, New York University School of Law
Equal measures computer science, law, economics, and behavioral science, this book will appeal to all four groups and introduce the concepts in a very enjoyable way. Whether people shop online, on their phones, or in stores, companies track them. What they buy, where they shop, when they shop, and how they shop can all be analyzed by retailers, who can then offer different products, coupons, and discounts. Retailers not only collect and analyze this data but also sell the data and analysis to other companies, sometimes including their competitors. This book delves into the privacy and regulatory complications of this data and analysis. Though readers may be taken aback by just how much information is collected about their shopping habits, this book describes in detail how retailers and marketers use ambivalence to privacy to market products and services at prices consumers are willing to pay.-- (04/01/2017)
From price-comparison algorithms to phone operating systems, technology has altered competitive commerce. Lawyers Ariel Ezrachi and Maurice E. Stucke question the democratic consequences of this dual-edged power.-- (10/15/2019)