Virtual Competition : : The Promise and Perils of the Algorithm-Driven Economy / / Ariel Ezrachi.

• Superior document: Title is part of eBook package: De Gruyter Harvard University Press Complete eBook-Package 2016
• VerfasserIn: Ezrachi, Ariel,
• Place / Publishing House: Cambridge, MA : : Harvard University Press, , [2017]; ©2016
• Year of Publication: 2017
• Language: English
• Physical Description: 1 online resource (300 p.) :; 3 halftones, 3 graphs

Shoppers with Internet access and a bargain-hunting impulse can find a universe of products at their fingertips. In this thought-provoking exposé, Ariel Ezrachi and Maurice Stucke invite us to take a harder look at today’s app-assisted paradise of digital shopping. While consumers reap many benefits from online purchasing, the sophisticated algorithms and data-crunching that make browsing so convenient are also changing the nature of market competition, and not always for the better. Computers colluding is one danger. Although long-standing laws prevent companies from fixing prices, data-driven algorithms can now quickly monitor competitors’ prices and adjust their own prices accordingly. So what is seemingly beneficial—increased price transparency—ironically can end up harming consumers. A second danger is behavioral discrimination. Here, companies track and profile consumers to get them to buy goods at the highest price they are willing to pay. The rise of super-platforms and their “frenemy” relationship with independent app developers raises a third danger. By controlling key platforms (such as the operating system of smartphones), data-driven monopolies dictate the flow of personal data and determine who gets to exploit potential buyers. Virtual Competition raises timely questions. To what extent does the “invisible hand” still hold sway? In markets continually manipulated by bots and algorithms, is competitive pricing an illusion? Can our current laws protect consumers? The changing market reality is already shifting power into the hands of the few. Ezrachi and Stucke explore the resulting risks to competition, our democratic ideals, and our economic and overall well-being.

Table of Contents

Frontmatter -- Contents -- Preface -- Part I. Setting the Scene -- 1. The Promise of a Better Competitive Environment -- 2. New Economic Reality: Th e Rise of Big Data and Big Analytics -- 3. Light Touch Antitrust -- 4. Looking beyond the Façade of Competition -- Part II. The Collusion Scenarios -- 5. The Messenger Scenario -- 6. Hub and Spoke -- 7. Tacit Collusion on Ste roids: The Predictable Agent -- 8. Artificial Intelligence, God View, and the Digital Eye -- Part III. Behavioral Discrimination -- 9. Price Discrimination (Briefly) Explained -- 10. The Age of Perfect Price Discrimination? -- 11. The Rise of “Almost Perfect” Behavioral Discrimination -- 12. Behavioral Discrimination: Economic and Social Perspectives -- 13. The Comparison Intermediaries -- Part IV. Frenemies -- 14. The Dynamic Interplay among Frenemies -- 15. Extraction and Capture -- 16. “Why Invite an Arsonist to Your Home?” Understanding the Frenemy Mentality -- 17. The Future of Frenemy: Th e Rise of Personal Assistants -- Part V. Intervention -- 18. To Regulate or Not to Regulate -- 19. The Enforcement Toolbox -- Final Reflections -- Notes -- Acknowledgments -- Index