What Ecological Systems Can Teach Us About Complexity in The Platform Economy?

The need for new ideas and experimentation for competition regulation of the platforms is ripe. On 14 December 2021, Elena Rovenskaya contributed just such ideas at the Workshop of the BRICS Competition Law and Policy Center (BRICS Center) in Moscow. She presented ASA’s ongoing research in the DigFaSt project which aims to gather established insights on networked systems, interactions, and value co-creation processes which are inherent features of the platform economy, and its most prominent digital platforms ecosystems.

Rovenskaya evaluated the existing use of ecological metaphors and insights which can be found in economics and business management literature which has over the years contributed various inspirations for new thought models, ideas, and experimentations to inform strategy of networked businesses. Such insights have helped to expand the platform economy by educating business leaders on network structures. On the other hand, they have also incentivized gatekeeping behaviors, exponential network growth, and data exclusivity, which has undermined competition in the platform economy and concentrated market power at an alarming rate for regulators.

Given the urgent need for new insights into competition regulation and policy for the platform era circumstances, her presentation demonstrated how competition authorities and other regulators can seek inspirations and knowledge on the complexities of digital platform ecosystems from systems ecology. Ecology organizes the study of the various agents, processes, and interactions of ecology into a hierarchical model starting from the microlevel which consists of microorganisms, to the mega level which encompasses entire biomes spanning across the seven continents. The DigFaSt project introduces these structures into the digital realm, by organizing the strategies, agents, processes, and interactions which occur in the platform economy into a framework which enables the analysis of their complex nature.

Alexey Ivanov, Director of the BRICS Competition Policy and Law Center also presented the Center’s ongoing research on the concentration of digital markets and, at the same time, the fragmentation of incentives and divergence of policy approaches which has undermined the enforcements of competition authorities, particularly, in BRICS economies. Svetlana Avdasheva, Professor, Department of Applied Economics, HSE University also discussed the inability of traditional competition policy thinking in understanding the incentives of platform orchestrators. Ioannis Lianos, President, Hellenic Competition Commission of Greece, presented his paper which uses the mechanisms of complexity sciences to understand broader network platform enterprises such as supermarkets.

Overall, the workshops discussions emphasized the need for new approaches in regulation of the platform economy in the digital era. There is a greater willingness to experiment with new ideas and notions such as the research being conducted in DigFaSt.

To watch the full stream of the workshop, click here.