TILEC Work In Progress: Bertin Martens
Towards More Efficient Information Sharing in Platform Markets: From ex-situ data portability to in-situ data access
Digital platforms facilitate interactions between consumers and merchants that allow collection of profiling information. Private incentives, however, result in information asymmetries and market failures among merchants in platforms and among competing platforms. This paper develops two product differentiation models to study private and social incentives to share information within and between platforms. We show that mandatory data sharing improves social welfare, more so than alternative regulatory interventions such as barring entry or break-up that make less efficient use of the available platform information. Moreover, we argue that an in-situ data access right is more efficient than existing ex-situ data portability rights because, by construction, it does not reduce the value of data-driven network effects. It is also more secure because it limits data privacy leakages.
Host: Konrad Borowicz
Moderator: Florian Schütt
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