Wednesday, October 18, 2017

GCR Live Women in Antitrust, Thursday, 09 November 2017, Washington D.C.

Thursday, 09 November 2017, Washington D.C., USA

Overview

Inspiring women in competition policy: promoting support networks among women working in antitrust in the public and private sector

Competition policy: what does the future hold?

Competition policy faces many challenges in 2017 and beyond, with a traditional approach based on consumer welfare and economic effects being called into question from the left and the right. Other factors, such as the interplay between competition and the public interest, innovation, big data, privacy, and even industrial policy are coming increasingly to the fore. This conference will explore what these developments mean for antitrust, and whether they spell a growing or weakening role for competition policy in tomorrow's global economy.

This conference will be unique not only in its broad vision of the future of competition enforcement and policy. It will also celebrate the many leading women in antitrust. The conference is chaired by women and will showcase the strength of women in antitrust among our speakers and moderators. GCR will also celebrate the leading Women in Antitrust named in our recent survey with an all-conference dinner after the event.

CONFERENCE TOPICS WILL INCLUDE:

  • Populism, public interest and antitrust
  • The nexus between competition and innovation
  • Big data and privacy as competitive concerns
  • US and EU: diverging competition enforcement priorities?

E-mail Tel: +44 20 3780 4137

Chairs

Kristina Nordlander

Sidley Austin, Brussels

Kristina Nordlander has a thriving EU competition, litigation and regulatory practice, representing major companies in a variety of sectors, including e-commerce, life sciences, financial services and payments, technology and chemicals. 

Edith Ramirez

Hogan Lovells, Washington, DC and Los Angeles

Edith Ramirez, former Chairwoman of the U.S. Federal Trade Commission (FTC), is co-head of the Antitrust and Competition practice and a partner in the Privacy and Cybersecurity practice. She has long been a strong presence in the international competition and privacy arena.

Speakers

Melanie Aitken

Bennett Jones, Washington DC

Fiona Carlin

Baker McKenzie, Brussels

Vicky Eatrides

Deputy Commissioner, Competition Promotion Branch, Canada Competition Bureau, Quebec

Deborah Garza

Covington & Burling, Washington, DC

Céline Gauer

Director, Energy & Environment, DG Competition, European Commission, Brussels

Catriona Hatton

Baker Botts, Brussels

Renata Hesse

Sullivan & Cromwell, Washington DC

Bojana Ignjatovic

RBB Economics, London

Aimee Imundo

Senior counsel, General Electric, Washington, DC

Claire Jeffs

Slaughter and May, Brussels

Susan Jones

Head Corporate Legal Antitrust, Novartis, Basel

Mary Lehner

Freshfields Bruckhaus Deringer, Washington DC

Karin Lunning

Director, Department of Communications and International Affairs, Swedish Competition Authority, Stockholm

Lindsay Lutz

Legal Director, Antitrust and Regulatory, eBay, San Francisco

Maureen Ohlhausen

Acting Chairman, Federal Trade Commission, Washington DC

Leigh Oliver

Hogan Lovells, Washington, DC

Alejandra Palacios Prieto

President, Federal Economic Competition Commission (COFECE), Mexico City

Maria Raptis

Skadden, Arps, Slate, Meagher & Flom, New York

Lauren Stiroh

Managing Director, NERA Economic Consulting, New York

Yingling Wei

JunHe, Shanghai

Programme

8.30: Welcome coffee and registration

9.00: Chairs' opening remarks

Edith Ramirez, Hogan Lovells, Washington, DC and Los Angeles
Kristina Nordlander, Sidley Austin, Brussels

9.15: Fireside chat 

Speakers:
Maureen Ohlhausen, Acting Chairman, Federal Trade Commission, Washington DC
Alejandra Palacios Prieto, President, Federal Economic Competition Commission (COFECE), Mexico City
Karin Lunning, Director, Department of Communications and International Affairs, Swedish Competition Authority, Stockholm

Interviewer
Melanie Aitken, Bennett Jones, Washington DC

10.15: Populism, public interest and antitrust

With political rhetoric in the developed world taking on a strong nationalist, anti-globalisation hue, what will be the impact on competition policy? What have we learned about US public enforcement in the Trump Administration in 2017? What about the EU's focus on fairness, including in corporate taxation? To what extent should governments globally consider public interest facets such as employment, environment or ‘industrial policy' in enforcement of competition law?

Moderator:
Mary Lehner, Freshfields Bruckhaus Deringer, Washington DC

Panel:
Vicky Eatrides, Deputy Commissioner, Competition Promotion Branch, Canada Competition Bureau, Quebec
Deborah Garza, Covington & Burling, Washington, DC
Céline Gauer, Director, Energy and Environment, DG Competition, European Commission, Brussels
Yingling Wei, JunHe, Shanghai

11.30: Coffee break

12.00: The nexus between competition and innovation

Is there a connection between innovation and concentration? Are new innovation theories of harm being pursued in competition enforcement? How are agencies considering innovation across the world?

Moderator:
Kristina Nordlander, Sidley Austin, Brussels

Panel:
Fiona Carlin, Baker McKenzie, Brussels
Susan Jones, Head Corporate Legal Antitrust, Novartis, Basel
Leigh Oliver, Hogan Lovells, Washington, DC
Lauren Stiroh, Managing Director, NERA Economic Consulting, New York

13.15: Networking lunch

14.15: Big data and privacy as competitive concerns

At what point does large-scale information become a competition concern? Where and what is the overlap between data privacy and competition?

Moderator:
Claire Jeffs, Slaughter and May, Brussels

Panel:
Maria Raptis, Skadden, Arps, Slate, Meagher & Flom, New York
Lindsay Lutz, Legal Director, Antitrust and Regulatory, eBay, San Francisco

15.30: Coffee break

16.00: Global competition regimes: diverging or converging?

In the US, Trump's seeming aim of dismantling the administrative state is in full swing, whereas in the EU, enforcement is if anything broadening - and post-Brexit, one can arguably expect even heavier regulation from the EU27. With this seeming tension between the two major regulatory approaches to competition law, what is the future for convergence and cooperation between the world's authorities? Where should agencies and counsel from developing economies look for leadership when different approaches emerge?

Moderator:
Catriona Hatton, Baker Botts, Brussels

Panel:
Renata Hesse, Sullivan & Cromwell, Washington DC
Bojana Ignjatovic, RBB Economics, London
Aimee Imundo, General Electric, Washington, DC

17.15: Chairs' closing remarks

Edith Ramirez, Hogan Lovells, Washington, DC and Los Angeles
Kristina Nordlander, Sidley Austin, Brussels

17.30: Drinks reception

19.00: All delegates are invited to attend an all-conference dinner, kindly hosted by NERA Economic Consulting

October 18, 2017 | Permalink | Comments (0)

Airline Economics: An Introductory Survey

Anming Zhang, University of British Columbia (UBC) - Sauder School of Business and Yahua Zhang, University of Southern Queensland offer Airline Economics: An Introductory Survey.

ABSTRACT: This paper has surveyed the topics in the field of airline economics, including areas such as airline costs and production, airline demand and revenue management, airline financial issues, and airline profitability. The debates in these areas are explored from an economic perspective to help readers understand contemporary economic issues and challenges facing the airline industry, and to provide the airline management with an economic way of thinking in dealing with these issues. This paper also aims to serve a purpose for air transport researchers to consider some under-researched areas where definitive answers to some interesting issues are still lacking. These include, among others, effective ways of reducing fuel cost risks such as fuel hedging and the adoption of new technologies, development of non-price competition strategies that can be used by airlines to differentiate their products, establishing new marketing strategies, and redesigning airline networks when surface transportation modes (e.g., high-speed rail) become a threat.

October 18, 2017 | Permalink | Comments (0)

Coopetition and Profit Sharing for Ride-Sharing Platforms

Maxime C. Cohen, New York University (NYU) - Leonard N. Stern School of Business and Renyu (Philip) Zhang, New York University Shanghai study Coopetition and Profit Sharing for Ride-Sharing Platforms.

ABSTRACT: The introduction of on-demand ride-hailing platforms totally changed the way people commute. In recent years, several firms entered this market to directly compete with traditional taxi companies. These online platforms often offer a carpooling service in which several passengers heading in the same direction can share a ride by being efficiently matched to an available vehicle. Examples of such services in NYC include uberPOOL, Lyft Line and Via. Recently, some of these platforms decided to engage in a profit sharing contract with one of their competitors by introducing a new hybrid service. For example, on June 6, 2017, Via officially announced a partnership with an online NYC taxi-hailing platform called Curb. This partnership allows riders to order a taxi, and share some portion of the trip with other riders by using Via's efficient matching algorithm. Since these two platforms are competing with each other, this form of partnership is often referred to as coopetition. This paper is motivated by this specific type of coopetition. We model the price competition between ride-hailing platforms by using the Multinomial Logit choice model, and show that a unique equilibrium exists. Then, we analyze the impact of introducing the new joint service to the market. Interestingly, we show that a well-designed profit sharing contract benefits both platforms. This result admits a similar win-win outcome as in the supply chain contract literature, even though these two settings are very different. In addition, we show that one can design a profit sharing contract that also benefits the riders and the drivers. Consequently, such a coopetition partnership may benefit every single party (riders, drivers and both platforms) when using a properly designed profit sharing contract.

October 18, 2017 | Permalink | Comments (0)

The Prohibition of Single-Firm Market Abuses: US Monopolization versus EU Abuse of Dominance

Francisco Marcos, IE Law School details The Prohibition of Single-Firm Market Abuses: US Monopolization versus EU Abuse of Dominance.

ABSTRACT: This article looks at the commonalities and disparities in the rules against single-firm market abuses in the US and in the EU and their enforcement. Despite they target the same type of business behaviour, the US and the EU have always followed divergent paths. This article will examine alternative explanations for the differences and will also look at the different forms of conduct caught under the prohibition, underlining the most recent enforcement discordances.

October 18, 2017 | Permalink | Comments (0)

Tuesday, October 17, 2017

Developing Competition Law for Collusion by Autonomous Price-Setting Agents

Joseph E. Harrington Jr, University of Pennsylvania is Developing Competition Law for Collusion by Autonomous Price-Setting Agents.

ABSTRACT: After arguing that collusion by software programs which choose pricing rules without any human intervention is not in violation of section 1 of the Sherman Act, the paper offers a path towards making collusion by autonomous agents unlawful.

October 17, 2017 | Permalink | Comments (0)

Competitive harm in global supply chains: assessing current responses and identifying potential future responses

David Gerber, Chicago Kent has a new article on Competitive harm in global supply chains: assessing current responses and identifying potential future responses.

ABSTRACT: Global supply (or ‘value’) chains add much to the value of global markets, offering benefits to both producers and consumers. Yet, global supply chains also carry a potential for harm that is often beyond the reach of current legal remedies. They can shield those that produce faulty or hazardous products or artificially raise prices from legal responsibility for the harms they cause to markets, consumers, or the environment. This article focuses on one set of those potential harms—those caused by anti-competitive conduct, but many of the issues also arise in relation to environmental, financial, and other types of harm. Producers anywhere in a chain can impede competition and raise prices for all subsequent purchasers. Such conduct may have effects in many jurisdictions, and its harmful effects are likely to be incurred outside the jurisdiction in which the conduct is located. Few legal tools are available for deterring such harms, and until very recently legal analysts have tended to subsume the issues under existing categories, often failing to notice that these categories and the tools based on them may be inadequate and ineffective in responding to a new organizational form. The inadequacy of the current legal framework calls for efforts to develop more effective tools, both domestic and transnational. This article reviews current responses to the problem and identifies the potential value of transnational coordination as a response.

October 17, 2017 | Permalink | Comments (0)

How Efficient is Dynamic Competition? The Case of Price as Investment

David Besanko, Ulrich Doraszelski, and Yaroslav Kryukov ask How Efficient is Dynamic Competition? The Case of Price as Investment.

ABSTRACT: We study industries where the price that a firm sets serves as an investment into lower cost or higher demand. We assess the welfare implications of the ensuing competition for the market using analytical and numerical approaches to compare the equilibria of a learning-by-doing model to the first-best planner solution. We show that dynamic competition leads to low deadweight loss. This cannot be attributed to similarity between the equilibria and the planner solution. Instead, we show how learning-by-doing causes the various contributions to deadweight loss to either be small or partly offset each other.

October 17, 2017 | Permalink | Comments (0)

Search Engines and Data Retention: Implications for Privacy and Antitrust

Lesley Chiou and Catherine Tucker  have a new paper on Search Engines and Data Retention: Implications for Privacy and Antitrust.

ABSTRACT: This paper investigates whether larger quantities of historical data affect a firm's ability to maintain market share in Internet search. We study whether the length of time that search engines retained their server logs affected the apparent accuracy of subsequent searches. Our analysis exploits changes in these policies prompted by the actions of policymakers. We find little empirical evidence that reducing the length of storage of past search engine searches affected the accuracy of search. Our results suggest that the possession of historical data confers less of an advantage in market share than is sometimes supposed. Our results also suggest that limits on data retention may impose fewer costs in instances where overly long data retention leads to privacy concerns such as an individual's ``right to be forgotten."

October 17, 2017 | Permalink | Comments (0)

Monday, October 16, 2017

The Political Economy of Competition Law in China

Wendy Ng (Melbourne Law and one of the best junior competition law scholars in the world) has a new book forthcoming  The Political Economy of Competition Law in China.

BOOK ABSTRACT: The Political Economy of Competition Law in China provides a unique perspective of China's competition law that is situated within its legal, institutional, economic, and political contexts. Adopting a framework that focuses on key stakeholders and the relevant governance and policy environment, and drawing upon stakeholder interviews, case studies, and doctrinal analysis, this book examines China's Anti-Monopoly Law in the context of the political economy from which it emerged and in which it is now enforced. It explains the legal and economic reasoning used by Chinese competition authorities in interpreting and applying the Anti-Monopoly Law, and offers valuable and novel insights into the processes and dynamics of law- and decision-making under that law.

October 16, 2017 | Permalink | Comments (0)

Multi Product Firms, Import Competition, and the Evolution of Firm-Product Technical Efficiencies

Emmanuel Dhyne, National Bank of Belgium, Amil Petrin, University of Minnesota - Duluth; National Bureau of Economic Research (NBER), Valérie Smeets, Aarhus School of Business; Université Libre de Bruxelles (ULB) - European Center for Advanced Research in Economics and Statistics (ECARES), and Frederic Warzynski, University of Aarhus - Department of Economics discuss Multi Product Firms, Import Competition, and the Evolution of Firm-Product Technical Efficiencies.

ABSTRACT: We study how increased import competition affects the evolution of firm-product technical efficiencies in the small open economy of Belgium. We observe quarterly firm-product data at the 8-digit level on quantities sold and firm-level labor, capital, and intermediate inputs from 1997 to 2007, a period marked by stark declines in tariffs applied to Chinese goods. Using Diewert (1973) and Lau (1976) we show how to estimate firm-product quarterly technical efficiencies using a multi-product production (MPP) function that avoids using single-product (SP) production function approximations to it. We find that a 0.01 increase in the import share leads to a 1.05% gain in technical efficiency. This elasticity translates into gains from competition over the sample period exceeding 1.2 billion euros, which is over 2.5% of the average annual value of manufacturing output in Belgium. Firms appear to be less technically efficient at producing goods the further they get from their "core" good and firms respond to competition by focusing more on their core products. Instrumenting import share - while not important for the signs of the coefficients - is very important for the magnitudes as the effect of competition increases tenfold when one moves from OLS to IV. We close by testing the SP approximation to MPP and reject in eight of twelve industries.

October 16, 2017 | Permalink | Comments (0)

A €6 Billion Unpaid Fine: The Ukrainian Antitrust Case Against Gazprom

Sergiy Glushchenko analyzes A €6 Billion Unpaid Fine: The Ukrainian Antitrust Case Against Gazprom.

ABSTRACT: The recent commitments offered by Gazprom to the European Commission (EC) in the long running abuse of dominance case provide a good opportunity to revisit another abuse of dominance case against the Russian gas giant, which recently concluded not with commitments but a prohibition decision and fines.

On 22 January 2016, the Antimonopoly Committee of Ukraine (AMC) announced a decision with a record fine on Gazprom. The investigation started in 2015 after the AMC investigated possible violations by Gazprom in the gas transit market. The AMC found the company had abused its monopsony position as the only buyer of gas transit services through Ukraine.

October 16, 2017 | Permalink | Comments (0)

Economic Findings Concerning the State of Competition for Wired Broadband Provision to U.S. Households and Edge Providers

David Evans, Global Economics Group, offers Economic Findings Concerning the State of Competition for Wired Broadband Provision to U.S. Households and Edge Providers.

ABSTRACT: The Federal Communications Commission and the U.S. Department of Justice, in the course of considering mergers and acquisitions as well as other policy matters, have conducted detailed investigations of the wired broadband business, and the intertwined business of providing linear programming. This paper summarizes the economic findings reached by the FCC and the Justice Department and their implications for public policy. These authorities have identified two significant market failures based on empirical studies, reviews of company documents, and other evidence. The first market failure results from the fact that large wired broadband providers are bottlenecks between edge providers and households and therefore able to exercise significant market power over edge providers by restricting access to households. The second market failure results from the fact that the large wired broadband providers also own large linear programming providers. The evidence shows that the companies that have common ownership over these related services have the incentives and abilities to harm edge providers that compete with their linear programming businesses. To prevent making these market failures from worsening, the FCC and Justice Department have blocked mergers or imposed conditions on the merging parties. The FCC and Justice Department findings are relevant for considering public policy towards the provision of wired broadband services to households and edge providers.

October 16, 2017 | Permalink | Comments (0)

Friday, October 13, 2017

Economic Analysis in Damages Actions—Insights from Recent Proceedings in the UK

Peter Davis discusses Economic Analysis in Damages Actions—Insights from Recent Proceedings in the UK.

ABSTRACT: Mobility Scooters highlights that collective actions must raise common issues, thus placing a focus on the variation in damages across claimants. The MasterCard consumer action highlights the challenge in taking a ‘top-down’ approach (estimating aggregate damages and only subsequently considering how to distribute that amount across individuals) and also the role of individual issues in collective actions. Retailers’ claims in MasterCard make clear the need for courts to pay careful attention to economic analysis, notably in the context of complex settings such as two-sided markets and in deriving counterfactual scenarios.

October 13, 2017 | Permalink | Comments (0)

Monopoly Without a Monopolist: An Economic Analysis of the Bitcoin Payment System

Gur Huberman, Columbia Business School - Finance and Economics, Jacob D. Leshno, Columbia University and Ciamac C. Moallemi, Columbia Business School - Decision Risk and Operations discuss Monopoly Without a Monopolist: An Economic Analysis of the Bitcoin Payment System.

ABSTRACT: Owned by nobody and controlled by an almost immutable protocol the Bitcoin payment system is a platform with two main constituencies: users and profit seeking miners who maintain the system’s infrastructure. The paper seeks to understand the economics of the system: How does the system raise revenue to pay for its infrastructure? How are usage fees determined? How much infrastructure is deployed? What are the implications of changing parameters in the protocol?   

A simplified economic model that captures the system's properties answers these questions. Transaction fees and infrastructure level are determined in an equilibrium of a congestion queueing game derived from the system's limited throughput. The system eliminates dead-weight loss from monopoly, but introduces other inefficiencies and requires congestion to raise revenue and fund infrastructure. We explore the future potential of such systems and provide design suggestions.

October 13, 2017 | Permalink | Comments (0)

The Adequacy of Competition Policy for Cryptocurrency Markets

Peder Østbye, Norges Bank argues for The Adequacy of Competition Policy for Cryptocurrency Markets.

ABSTRACT: Several cryptocurrencies are now circulating in the economy. Many have significant market value measured in national currencies. The intention behind most of these currencies is to replace or supplement the traditional payment system based on national currencies. Cryptocurrencies can potentially obtain a significant role in the payment system. However, the presence of cryptocurrencies raises several public policy concerns. This paper addresses competition policy. It discusses as to whether traditional competition policy instruments such as antitrust and regulation are adequate to address competition policy concerns. It is found that traditional competition policy instruments are inadequate. Direct participation by the public in the form of central bank digital currencies may be an adequate remedy. The relationship between competition policy and other relevant policies for the cryptocurrency markets is also discussed.

October 13, 2017 | Permalink | Comments (0)

Thursday, October 12, 2017

Fred S. McChesney (1948-2017)

I am saddened to report the death of antitrust scholar Fred McChesney.  Fred taught at a number of schools, most recently Miami and before that at Northwestern, Cornell and Emory.  He also worked at the FTC during the Reagan years.  Fred made important contributions to antitrust and in particular in the study of Virginia School public choice analysis of antitrust institutions. 

Lamentably, Fred was in bad shape for a while.  I really liked him.  He could sometimes be tough but inside he was a real sweetheart - a really caring and nice guy.  I worked with him as his editor on a chapter for my Oxford Handbook of International Antitrust Economics. We had great back and forth on ideological, doctrinal, religious, and sometimes health issues over the past 8 years. At one point he asked me to join him as a coauthor on his antitrust casebook.  I am very idiosyncratic when it comes to casebook philosophy so I politely declined but in retrospect, it would have meant some more time spent with Fred.  I am sorry that I don't have that time to spend with him ever again.

October 12, 2017 | Permalink | Comments (0)

Coopetition and Profit Sharing for Ride-Sharing Platforms

Maxime C. Cohen, New York University (NYU) - Leonard N. Stern School of Business and Renyu (Philip) Zhang, New York University Shanghai examine Coopetition and Profit Sharing for Ride-Sharing Platforms.

ABSTRACT: The introduction of on-demand ride-hailing platforms totally changed the way people commute. In recent years, several firms entered this market to directly compete with traditional taxi companies. These online platforms often offer a carpooling service in which several passengers heading in the same direction can share a ride by being efficiently matched to an available vehicle. Examples of such services in NYC include uberPOOL, Lyft Line and Via. Recently, some of these platforms decided to engage in a profit sharing contract with one of their competitors by introducing a new hybrid service. For example, on June 6, 2017, Via officially announced a partnership with an online NYC taxi-hailing platform called Curb. This partnership allows riders to order a taxi, and share some portion of the trip with other riders by using Via's efficient matching algorithm. Since these two platforms are competing with each other, this form of partnership is often referred to as coopetition. This paper is motivated by this specific type of coopetition. We model the price competition between ride-hailing platforms by using the Multinomial Logit choice model, and show that a unique equilibrium exists. Then, we analyze the impact of introducing the new joint service to the market. Interestingly, we show that a well-designed profit sharing contract benefits both platforms. This result admits a similar win-win outcome as in the supply chain contract literature, even though these two settings are very different. In addition, we show that one can design a profit sharing contract that also benefits the riders and the drivers. Consequently, such a coopetition partnership may benefit every single party (riders, drivers and both platforms) when using a properly designed profit sharing contract.

October 12, 2017 | Permalink | Comments (0)

Nonlinear and asymmetric pricing behaviour in the Spanish gasoline market

Torrado, María and Escribano Sáez, Álvaro examine Nonlinear and asymmetric pricing behaviour in the Spanish gasoline market.

ABSTRACT: Over the last decades a transition from a state-own monopoly to a private business took placein the Spanish fuel sector. To figure out whether downstream prices react differently toupstream price increases than to price decreases, alternative dynamic nonlinear andasymmetric error correction models are applied to weekly price data. This paper analyse theexistence of price asymmetries in the fuel market in Spain during the 2011-2016 period. Incomparison with traditional asymmetric price theory literature, this paper introduces a newdouble threshold error correction (ECM) model (DT-ECM) and new double logistic ECMmodels and compares them with more common linear ECM, time varying parameter models(TV-ECM), threshold autoregressive models (T-ECM), smooth transition autoregressive(STAR) models and nonlinear error correction (Logistic-ECM) and double threshold Logistic(DT-Logistic ECM). The nonlinear and asymmetric results found show that sophisticatedbivariate long-run asymmetries are present in the prices of the fuel sector and that those pricereactions depend on whether the oil price increases or decreases, on the stage of theproduction, the distribution chain as well as on the period considered.

October 12, 2017 | Permalink | Comments (0)

EU competition law in innovation and digital markets: fairness and the consumer welfare perspective

Johannes Laitenberger, Director-General for Competition, European Commission has a new speech on EU competition law in innovation and digital markets: fairness and the consumer welfare perspective.

October 12, 2017 | Permalink | Comments (0)

The Economic Functioning of Online Drugs Markets

V. Bhaskar ; Robin Linacre ; Stephen Machin describe The Economic Functioning of Online Drugs Markets.

ABSTRACT: The economic functioning of online drug markets using data scraped from online platforms is studied. Analysis of over 1.5 million online drugs sales shows online drugs markets tend to function without the significant moral hazard problems that, a priori, one might think would plague them. Only a small proportion of online drugs deals receive bad ratings from buyers, and online markets suffer less from problems of adulteration and low quality that are a common feature of street sales of illegal drugs. Furthermore, as with legal online markets, the market penalizes bad ratings, which subsequently lead to significant sales reductions and to market exit. The impact of the well-known seizure by law enforcement of the original Silk Road and the shutdown of Silk Road 2.0 are also studied, together with the exit scam of the market leader at the time, Evolution. There is no evidence that these exits deterred buyers or sellers from online drugs trading, as new platforms rapidly replaced those taken down, with the online market for drugs continuing to grow.

October 12, 2017 | Permalink | Comments (0)