Competition policy

Tobias Kretschmer, Sven Werner, 28 August 2021

Recent discussions on how to regulate dominant online platforms revolve around the suitability of applying existing regulatory frameworks. This column contrasts the economic and strategic features of platform business models to those of utility industries, which are often considered structurally similar. It argues that the design of effective regulation for dominant digital platforms should account for platforms’ nature as an ecosystem of independent actors and for their relatively shorter innovation cycles.

Xuelin Li, Andrew Lo, Richard Thakor, 11 August 2021

Innovation is a key driver of economic growth, and incentivising research and development is therefore a vital policy goal. This column explores the role of competition policy in stimulating innovation by pharmaceutical firms. Specifically, the authors assess the effect that ‘pay-for-delay’ agreements have on firm-level research and development in the US. The results suggest that restricting the ability of firms to engage in pay-for-delay agreements appears to increase their incentives to innovate in the face of competition, although the aggregate effects are not clear-cut.

Ben Vollaard, Jan van Ours, 24 June 2021

Many expert product reviews are non-blind and influenced by cosy relationships between reviewers and producers that consumers are not aware of. The downside of biased reviews is largely unknown because of a lack of data and small sample sizes. Based on unique data for a long-running expert product review in the food-service industry, this column finds that a conflict of interests for reviewers led to a sizeable bias in ratings. This casts doubt on the value of non-blind expert product reviews that are not bound by very strict rules.

Gregory Crawford, Cristina Caffarra, 08 June 2021

The CEPR's Research Policy Network on competition policy launches this week. In the first of two special podcasts on the topic, Greg Crawford and Cristina Caffarra tell Tim Phillips why it is so important to have this debate now, and how academics can use the RPN to connect their research to real-world policy.

You can find out more about and register for the event on June 17th 2021 here: Privacy & Antitrust: "Integration", not just "Intersection"

Walter Beckert, Howard Smith, Yuya Takahashi, 28 April 2021

Many antitrust investigations, particularly for intermediate goods, involve markets where the buyer negotiates with competing sellers and gets an individualised price. This column explores the conceptual differences between individualised pricing and standard uniform pricing, and reports some recent evidence that provides empirical support for the view that these differences can have a major impact on market power and merger effects, which should be accounted for in competition policy.

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