Until recently, most competition authorities have prioritized consumer welfare and efficiency in their approach to regulate industry markets. However, the multisided nature of the platform economy means that monitoring of markets must consider not just consumer welfare, but also the welfare of complementors, third parties, and all participants of digital platform ecosystems (DPE) in the short and long term.
On March 21, New Delhi welcomed competition policymakers, scientists, and senior industry stakeholders from BRICS countries at the Competition and Big Tech International Conference, jointly organized by the BRICS International Center for Competition Law and Policy, the Competition Commission of India (CCI) and the Regulatory Competition Institute (CIRC) of CUTS International (Consumer Unity & Trust Society). Here, IIASA Advancing Systems Analysis (ASA) Program Director, Elena Rovenskaya, delivered ASA’s latest research on the application of complex adaptive systems (CAS) theory to understand DPEs as complex structures harnessing value from the agents present within its ecosystems. Her presentation built on the previous disseminative efforts which details how the complex adaptive nature of the platform economy lends itself to the concepts and tools used to study natural ecosystems.
During the panel session Ecological Approaches to Competition Law in the New Economy, Rovenskaya demonstrated how ecological concepts and tools can be adapted to understanding DPEs on the basis that both ecological systems and DPEs are forms of complex adaptive systems (CAS). She presented an evaluation of the CAS traits intrinsic to the platform economy and remonstrated the need for a new worldview in the platform economy, inspired by natural ecosystems.
In a highly interactive DPE, anti-competitive behavior of platform orchestrators can greatly impact all ecosystem participants and ripple industry wide. Competition regulators often only rely on size of revenue or market shares to gauge whether a DPE has the power to engage in anti-competitive or gatekeeping behavior which means that larger DPEs may be unfairly penalized. Furthermore, regulators rely often rely on DPEs themselves for information on the policy decisions in the absence of a standardized knowledge framework. Integrating several stakeholder opinions could help competition regulators analyze indirect impacts of regulatory decisions such as merger propositions on complementors as well as consumers, and overtime, use such insights to develop a robust knowledge of the precise information needed to review future antitrust regulation.
Systems mapping, an established tool in systems science, can be integrated to evaluate indirect outcomes of regulatory decisions on DPE participants in the platform economy. Rovenskaya presented a case study to show how stakeholder opinions on potential antitrust decisions can be aggregated to show from short run to long run impact. Causal loop diagrams have greatly progressed the way in which we can comprehend the interplay of multiple factors impacting the dynamics of a CAS. As part of the ECOANTITRUST project, Rovenskaya presented how such tools, as part of CAS analysis, could be applied to unravel the intricate networks of DPEs such that they can be better scrutinized under the principles of antitrust competition.
The conference also held several presentations from BRICS competition policymakers and experts including Jyoti Jindgar Bhanot, Secretary of CCI, Andrey Tsyganov, Deputy Head of Federal Antimonopoly Service (FAS) Russia, and Kong Ru, Deputy Director of Anti-Monopoly Enforcement Division II China. Overall, the participants identified with the need for swift circular reforms in the competition regulation for digital markets particularly in BRICS countries and engaged in a constructive and transdisciplinary dialogue around digital markets and platform regulation.
To read more about ECOANTITRUST and past projects, click here.
To read more about the Competition and Big Tech International Conference, click here.
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