Monday, May 31, 2021
This chapter examines the Italian legal framework regulating the collective rights of self-employed workers. It seeks to investigate potential conflicts (if any) arising between collective labour rights and the application of competition law and free-market policies to self-employed workers and the fragmented constellation of differentiated personal labour relations that escape binary taxonomies. Its overarching goal is to understand whether and to what extent concerted wage-fixing practices are granted a special (express or implied) immunity at the domestic level. Besides offering concrete examples, we will situate the examination of labour antitrust exemption in the broader picture of the adequacy of the current mechanisms of “collective self-regulation” for “solo”, own account, small-scale, or dependent self-employed workers. However, historical evidence suggests that collective agreements covering the kaleidoscopic and dynamic group of non-standard workers have never been targeted by the Italian competition authority. In Italy self-employed organising is foreseen by the Constitution, long-standing, embedded in collective agreements, and widely acknowledged by the law. Indeed, workers’ initiatives can be seen as a vehicle of social, economic and political transformation.
This chapter is organised as follows. Part 2 presents a general introduction of the regulation of collective rights in the Italian Constitution. Part 3 illustrates case law development, especially at the Constitutional Court level, on whether self-employed workers fall within the personal scope of collective rights. It also argues that several provisions corroborate that the lawmaker often entrusts social partners in regulating specific and meaningful aspects of the working relationship of certain categories of self-employed workers, thus proving that there is no inconsistency between antitrust law and collective regulation of contractual terms. Two arguments run intertwined in part 4. On the one hand, we intend to present a selection of collective agreements for non-standard workers, never called into question by competition authorities, and on the other, we discuss how long-established trade unions have attempted to include non-standard workers in their membership through multiple, not necessarily successful, attempts. This section also presents a selection of practical hurdles that make it difficult to build solidarity amongst non-standard workers and negotiate collectively. Section 5 concludes.
May 31, 2021 | Permalink | Comments (0)
We investigate whether there is a link between competition policy and the decline in the labour share observed in many industrialised countries. By using a panel of 22 industries in 12 OECD economies, over the period 1995-2005, we find a positive link between an effective competition policy and the labour share trend. Our findings support the hypothesis that a lax or inactive competition policy has contributed to the decline of the labour share across many developed countries. The main mechanism through which competition policy affects the labour share is through its ability to constrain mark-ups: competition policy is negatively correlated to mark-ups, while mark-ups are negatively correlated to labour share. The results suggest that competition policy could be particularly important in mitigating the decline of the labour share in settings characterised by low levels of labour protection and labour bargaining power. More broadly, by permitting higher mark-ups to be sustained in some industries and jurisdictions, the results suggest that weak competition policy may contribute to higher levels of economic inequality given that labour income is more evenly distributed across households than capital income.
May 31, 2021 | Permalink | Comments (0)
Comment on Scott Hemphill’s "Uncertain Harms: The Case of Nascent Competitors".
May 31, 2021 | Permalink | Comments (0)
The majority staff of the House Judiciary Committee recently released its Report and Recommendations (“MSRR”) following an investigation of competition in digital markets. It claims that the leading digital technology firms (Alphabet, Amazon, Apple, Facebook) have acquired and maintained monopoly power by exclusionary conduct, and blames this on alleged narrow vision and weak enforcement efforts of the U.S. antitrust agencies and courts. The MSRR proposes a near-total revision of U.S. antitrust, restoring the enforcement approaches of fifty years ago when per se rules and structural presumptions were predominant. Considering that the U.S. is the unquestioned leader in digital technology, and that the EU has far fewer leading digital technology firms but does have antitrust rules very much like those proposed by the MSRR, it seems that both the MSRR’s view of the evidence and the logic of its proposals are questionable.
May 31, 2021 | Permalink | Comments (0)
Friday, May 28, 2021
Abstract
This article examines two important aspects of the Nutanix, the very first case brought and decided under the Hong Kong Competition Ordinance (Cap 619), which came into full effect back in 2015 as the first piece of cross-sector competition legislation in Hong Kong. Both aspects pertain to the ‘agreement’ element under the First Conduct Rule in the Ordinance. The first aspect is the analysis of a ‘hub-and-spoke’ arrangement; the second aspect is corporate attribution. It is argued, in respect of the first aspect, that the ‘hub-and-spoke’ bid-rigging arrangement in Nutanix need not be analysed in terms of multiple agreements between the ‘hub’ and the ‘spokes’. The preferred approach would be to analyse the arrangement as a single antitrust agreement based on a general, joint intention of bid-rigging shared amongst the ‘hub’ and the ‘spokes’. Significantly, it is not necessary for the ‘spokes’ to be aware of one another’s identity or existence for them to be considered as parties to the agreement, as an English contract law precedent would suggest. It is also argued, in respect of the second aspect, that, while the Hong Kong Competition Tribunal justifiably preferred a stricter standard of attribution for competition law liability—namely, the test of ‘sufficient connection’ between the employee’s behaviour and the employer undertaking—than tortious vicarious liability (ie the test of ‘close connection’), the ‘sufficient connection’ test suffers from the same problems of vagueness and indeterminacy as the tort law standard. The test would thus benefit from further judicial clarification and particularization.
May 28, 2021 | Permalink | Comments (0)
This essay argues that, although the International Exhaustion regime provides the greatest scope for market competition among all the regimes of exhaustion of intellectual property rights, unrestricted parallel trade may prove to be harmful in the long run. The Exhaustion principle may promote competition in markets by limiting the control of an IP owner over the resale and distribution of such IP, but the extent of such promotional effect depends on the extent to which the principle applies. The National, Regional, and the International Exhaustion regimes all contain pro-competitive benefits, however, an international regime will obviously provide for maximum market competition due to its larger area of operation. Unrestricted application of such a regime may however give rise to market harm eventually, particularly in the case of pharmaceutical patents, such as restricted market access, price inflation in developing markets, as well as a lack of incentive to innovate.
May 28, 2021 | Permalink | Comments (0)
Abstract
Most technical standards-development organizations (SDOs) have adopted internal policies embodying “due process” criteria such as openness, balance of interests, consensus decision making and appeals. These requirements arise from numerous sources including antitrust law, international trade law, public procurement requirements and institutional norms. Yet balance criteria lack a generally-accepted definition and the manner in which they are implemented varies, sometimes dramatically, among SDOs. Recently, there has been a renewed interest in the principle that SDOs should ensure a balance of interests among their stakeholders, including in the development of intellectual property rights policies. This article explores the origins and meaning of the balance requirement in the U.S. and EU, and identifies distinct legal, administrative and institutional modalities in which balance requirements are imposed, as well as existing antitrust and competition law requirements surrounding SDO balance.
May 28, 2021 | Permalink | Comments (0)
Abstract
Most technical standards-development organizations (SDOs) have adopted internal policies embodying “due process” criteria such as openness, balance of interests, consensus decision making and appeals. These requirements arise from numerous sources including antitrust law, international trade law, public procurement requirements and institutional norms. Yet balance criteria lack a generally-accepted definition and the manner in which they are implemented varies, sometimes dramatically, among SDOs. Recently, there has been a renewed interest in the principle that SDOs should ensure a balance of interests among their stakeholders, including in the development of intellectual property rights policies. This article explores the origins and meaning of the balance requirement in the U.S. and EU, and identifies distinct legal, administrative and institutional modalities in which balance requirements are imposed, as well as existing antitrust and competition law requirements surrounding SDO balance.
May 28, 2021 | Permalink | Comments (0)
Thursday, May 27, 2021
Economic policy determines the intensity of competition in markets. This gives incumbents the incentive to use their financial resources to influence policymaking in order to restrict competition and maintain or increase economic profits. Public authorities should promote that profits be used rather in welfare enhancing or neutral ways. Is competition law an adequate tool to promote this goal? This paper aims to ground the discussion on legal administrability considerations. The focus is therefore on whether we can design legal standards and identify evidence that courts can use to assess the tradeoffs between static efficiency, political influence of large corporations, and innovation. This paper argues that if political considerations are to be taken into account in antitrust analysis, these should be made explicit and looking at the evidence at hand in each case, in order to avoid enforcement guided by assumptions – such as that increases in market concentration always lead to risks in terms of political influence – that can otherwise be revised on a case-by-case basis.
May 27, 2021 | Permalink | Comments (0)
Abstract
Personalized and social commerce are becoming increasingly prevalent and are transforming how businesses operate and how consumers make choices. The primary goal of this paper is to review the existing literature relating to personalized and social commerce. To accomplish this goal, we first delineate and summarize the definitions of these two related concepts and highlight their intersections and differences. Second, we discuss the economics of personalized and social commerce by presenting the key economic frameworks used to analyze the welfare implications of these ecosystems, such as multi-sided platforms, intermediaries, social media, and other related marketplaces. We review distinct research streams encompassing perspectives from economics, marketing, management, information systems, sociology, and psychology. This paper bridges these distinct bodies of research in order to identify and systematize the evidence relating to the benefits and challenges of personalized and social commerce to both consumers and businesses. Finally, we identify existing limitations and gaps in the literature and discuss directions for future research.
May 27, 2021 | Permalink | Comments (0)
This paper provides a critical analysis of the antitrust report from the Subcommittee on Antitrust, Commercial, and Administrative Law of the House Committee on the Judiciary, based on the consumer welfare standard, which has governed antitrust policy since the late 1970s. It also proposes a theoretical framework for refutation of the report’s allegations about anticompetitive conduct of the big four tech companies that we hope will be useful for future empirical work. Using this framework, we find that the report likely overstates the market power held by these tech companies and the extent to which their conduct is actually harmful to consumers. In addition, our framework leads us to hypothesize that the reforms advocated in the report may actually make consumers worse off by interfering with market dynamism and slowing innovation.
May 27, 2021 | Permalink | Comments (0)
Competition for attention is causing a mental health crisis. At issue is that platforms, devices, and applications (“apps”) strive to maximize attention by, as examples, presenting users with curated streams of extremist content or manipulating parts of the brain tasked with controlling an addictive neurochemical called dopamine. The purpose of doing so is economic: a platform or app’s value is typically derived from the amount of time spent on it and depth of interaction (clicks, swipes, etc.). By manipulating the brain to pay attention and engage, research has found that tech addiction produces elevated rates of depression, anxiety, and similar disorders.
This landscape has led to outrage because the tech firms most responsible for imposing mental health costs wield an abundance of market power, which should perhaps attract antitrust review. The obstacle is that antitrust can only redress economic injuries such as high prices, restricted output, diminished innovation, and suboptimal quality. Because mental health is often described as a social type of injury, courts, litigants, and antitrust agencies have ignored or even rejected premising antitrust lawsuits in elevated rates of depression and anxiety. Illustrating this blind spot, Congress avoided the mental health crisis when it held an antitrust hearing in 2020 with leaders of “Big Tech” as well as when the antitrust agencies initiated lawsuits against Google and Facebook. Since tech firms offer unlimited quantities of innovative content for “free,” Big Tech has so far evaded antitrust liability despite allegedly impairing society’s mental health.
This Article argues that elevated rates of anxiety, depression, and similar disorders should equate to paying high prices, which antitrust has missed. Rather than a social injury, mental health disorders drain $1 trillion from the U.S. economy annually due to missed work, lost productivity, costs of treatment, and elevated unemployment. This research shows that tech firms can raise barriers to entry in order to accrue above-market profits while offloading heightened costs of mental health onto users. It also demonstrates that enhancing competition would help. Using recent examples, competition has led an array of dominant firms to vie for users along mental health dimensions—such as the innovation of digital wellness programs and scaling back digital manipulation—while reducing revenue to competitive levels. But since courts have seldom found an antitrust offense without high prices, yet most dominant tech firms offer innovative products for cheap or zero prices, antitrust law must recognize that eroded mental health reflects the actual costs of anticompetitive conduct in attention markets.
May 27, 2021 | Permalink | Comments (0)
Apple’s iOS 14 update represents an anti-competitive strategy disguised as a privacy-protecting measure. Apple now prohibits non-Apple apps from using information essential to providing relevant, personalized advertising, without explicit user opt-in. And users may opt-in only after they are shown an ominous and misleading prompt about “tracking,” one that Apple’s own apps and services need not display, because consumers are automatically “opted in” to Apple’s own tracking. Apple’s policy will have the pernicious effects of enhancing the dominance of iOS among mobile operating systems and the dominance of its own apps and services within the iOS ecosystem, while reducing consumer choice and devastating the free-app ecosystem.
This paper explains: (i) Apple’s dominance in mobile OSs and the competitive dynamics in the industry, including the critical role that personalized advertising plays in today’s mobile app ecosystem; (ii) how Apple’s iOS 14 updates dramatically alter today’s mobile OS ecosystem, wrongfully preference Apple’s own products and services, and help Apple protect and augment its dominance over iOS and more broadly over mobile OSs; and (iii) why such actions harm competition, and by extension, iOS users and consumers more broadly.
May 27, 2021 | Permalink | Comments (0)
Antitrust cases, including recent complaints filed against dominant technology platforms, have alleged conduct that harms innovation. Courts, however, have little experience adjudicating such allegations. This article concludes that Section 2 of the Sherman Act is sufficiently broad to address conduct that harms innovation and describes various ways in which innovation might affect the determination of antitrust liability or provide a defense against anticompetitive conduct. The article briefly reviews the economics literature relating the effects of market power on innovation incentives and identifies circumstances in which structural conditions warrant a presumption that anticompetitive conduct by a dominant firm is likely to harm or promote innovation.
May 27, 2021 | Permalink | Comments (0)
Wednesday, May 26, 2021
May 26, 2021 | Permalink | Comments (0)
May 26, 2021 | Permalink | Comments (0)
May 26, 2021 | Permalink | Comments (0)
Abstract
Contracts that reference rivals' volumes (RRV contracts), such as exclusive dealing or market-share rebates, have been a long-standing concern in antitrust because of their possible exclusionary effects. We show, however, that it is more profitable for dominant firms to use these contracts to exploit rivals rather than to foreclose them. By designing RRV contracts so that rivals stay active but are marginalized, a dominant firm may obtain higher profits than if it were an unchallenged monopolist. In the most favorable cases, it can earn as much as if it could eliminate the competition and acquire the rivals' specific technological capabilities free of charge. Besides being more profitable, exploitative strategies are also generally less anti-competitive than traditional exclusionary strategies.
May 26, 2021 | Permalink | Comments (0)
Tuesday, May 25, 2021
We provide an evaluation of the impact of public subsidy schemes that aimed to support the development of basic broadband infrastructure in rural areas of Germany. Such subsidies are subject to state aid control by the European Commission (EC). While the EC increasingly recognises the role of economic analysis in controlling public aid to companies, there are to date no full retrospective studies performed on state aid control, especially assessing the so-called balancing test. In this study, we do not only analyse whether the aid was effective in solving a market failure – low broadband coverage in rural areas – but also study its impact on competitive outcomes, on both rival firms and consumers. We adopt a difference-in-differences framework after using a matching procedure to account for selection on observables. We find that the aid significantly increased broadband coverage. More importantly, we find that the number of internet providers has significantly increased in the municipalities receiving aid. This additional entry decreased average prices. Therefore, the subsidies complied with EU state aid rules, both in terms of effectiveness and competition.
May 25, 2021 | Permalink | Comments (0)
Monday, May 24, 2021
This paper uses new data to reexamine trends in concentration in U.S. markets from 1994 to 2019. The paper's main contribution is to construct concentration measures that reflect narrowly defined consumption-based product markets, as would be defined in an antitrust setting, while accounting for cross-brand ownership, and to do so over a broad range of consumer goods and services. Our findings differ substantially from well established results using production data. We find that 42.2% of the industries in our sample are “highly concentrated” as defined by the U.S. Horizontal Merger Guidelines, which is much higher than previous results. Also in contrast with the previous literature, we find that product market concentration has been decreasing since 1994. This finding holds at the national level and also when product markets are defined locally in 29 state groups. We find increasing concentration once markets are aggregated to a broader sector level. We argue that these two diverging trends are best explained by a simple theoretical model based on Melitz and Ottaviano (2008), in which the costs of a firm supplying adjacent geographic or product markets falls over time, and efficient firms enter each others' home product markets.
May 24, 2021 | Permalink | Comments (0)
