Abstract
Does enhanced access to data foster or hinder competition among firms? Using a competition-in-utility framework that encompasses many situations where firms use data, we model data as a revenue-shifter and identify two opposite effects: a mark-up effect according to which data induces firms to compete harder, and a surplus-extraction effect. We provide conditions for data to be pro- or anti-competitive, requiring neither knowledge of demand nor computation of equilibrium. We apply our results to situations where data is used to recommend products, monitor insuree behavior, price-discriminate, or target advertising. We also revisit the issue of data and market structure.
JEL codes
- L1: Market Structure, Firm Strategy, and Market Performance
- L4: Antitrust Issues and Policies
- L5: Regulation and Industrial Policy
Replaces
Alexandre de Cornière, and Greg Taylor, “Data and Competition: a General Framework with Applications to Mergers, Market Structure, and Privacy Policy”, TSE Working Paper, n. 20-1076, February 2020, revised December 2021.
Replaced by
Alexandre de Cornière, and Greg Taylor, “Data and Competition: A Simple Framework”, The RAND Journal of Economics, vol. 56, n. 4, November 2025, pp. 494–510.
Reference
Alexandre de Cornière, and Greg Taylor, “Data and Competition: A Simple Framework”, TSE Working Paper, n. 23-1404, January 2023, revised August 2024.
See also
Published in
TSE Working Paper, n. 23-1404, January 2023, revised August 2024