Tuesday, June 15, 2021
The migration of business and social activities from physical to virtual venues, once known as the transition to the “New Economy,” is one of the defining characteristics of the digital revolution. This article explores a relatively underdeveloped aspect of the migration: the proliferation of fluid forms of arrangements, which, in the absence of a better term, I call flexible market arrangements (FMAs). In their essence, FMAs are alternatives to some of the structured arrangements that pervaded the brick-and-mortar economy. The core feature of FMAs—the flexibility—is derived from the elimination of economic constraints that are inherent to activities in physical spaces, such as the location of workers and consumers, capital investments, long-term contracts, employment relations, and preferences for in-person interactions. Concerns about competition in digital and labor markets and long-term trends in income and wealth inequality have shaped debates over antitrust policies in recent years. These debates, I argue, have failed to identify adequately the significance of the increasing prevalence of FMAs.
This article explains why the rapid spread of FMAs will become the subject of antitrust litigation, investigations, and legislative proposals. It further reviews changes in antitrust law and antitrust analysis that the proliferation of FMAs is likely to trigger.