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

Format:

Book

Author/Creator:

Ezrachi, Ariel., author.

Stucke, Maurice E., author.

Language:

English

Subjects (All):

Electronic commerce.

Pricing--Technological innovations.

Pricing.

Physical Description:

1 online resource (365 pages)

Place of Publication:

Cambridge, MA : Harvard University Press, [2017]

Language Note:

In English.

Summary:

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.

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

Notes:

Includes index.

Description based on online resource; title from PDF title page (publisher's Web site, viewed Feb. 24, 2017)

ISBN:

9780674973350

0674973356

9780674973336

067497333X

OCLC:

984658148