The meteoric rise of large digital platform firms is producing unprecedented business models and technologies, but it’s also testing the ability of governments and regulators to ensure fair and pro-competitive markets.
One of the latest efforts in the European Union to create guardrails for platforms is the Digital Markets Act (DMA). The DMA seeks to prevent Big Tech companies, also known as ‘gatekeepers,’ from abusing their market power and to allow new and smaller firms a fair shake.
Recently, a panel of economic experts from various universities and institutions—including three who are also Stanford Digital Fellows—vetted the pros, cons, and possible loopholes of the DMA. Their report explores a series of regulations to curb anti-competitive behaviors and proposes ways to use valuable data gathered by platforms for pro-competitive purposes.
The TL;DR: The panel endorses the vision laid out in the DMA, including the establishment of guidelines to define gatekeeper platforms and curb monopolistic behaviors. Yet the panel agrees that some anti-competitive practices, such as bundling, may still offer value to consumers.
For the DMA to be effective, regulators will require detailed information about what’s happening in real-time on gatekeeper platforms. This is a non-trivial logistical issue that requires further thought.
In the videos below, three Stanford Digital Fellows on the panel—Geoffrey Parker, Georgios Petropoulos, and Marshall van Alstyne—discuss various aspects of the act.
Marshall Van Alstyne and Geoffrey Parker talk about how the DMA seeks to regulate gatekeeper firm behavior and combat anti-competitive behavior.
Geoffrey Parker discusses measures the DMA proposes to limit the power gatekeeper firms have over their customers and vendors.
Marshall Van Alstyne talks about the implications the DMA would have on how users control their data.
Georgios Petropoulos discusses ways the DMA seeks to limit anti-competitive behaviors, including tying, bundling, and self-preferencing.
Geoffrey Parker, Georgios Petropoulos, and Marshall Van Alstyne discuss various measures proposed by the Digital Markets Act and what they could mean for users, vendors, and gatekeeper firms.
New York University (NYU) – Leonard N. Stern School of Business – Department of Economics; Centre for Economic Policy Research (CEPR)
Heinrich Heine University Dusseldorf – Department of Economics; German Institute for Economic Research (DIW Berlin)
Massachusetts Institute of Technology (MIT); Bruegel; Stanford Digital Fellow
Imperial College Business School; Centre for Economic Policy Research (CEPR)
Boston University – Questrom School of Business; Massachusetts Institute of Technology (MIT) – Sloan School, Stanford Digital Fellow
The Stanford Digital Economy Lab is an integral part of the Stanford Institute for Human-Centered AI (HAI). We are the Institute’s primary hub for conducting research related to the economic implications of technology—a demonstration of HAI’s multidisciplinary approach to addressing complex problems. The Lab is co-sponsored by the Stanford Institute for Economic Policy Research.