Skip to main content

Information services: competition and externalities

Objective

This application aims at fostering our knowledge of the economics of information services by studying the strategic interactions between agents involved in the production and exchange of information services. In this context, externalities play a key role explored by this proposal. Their increasing prevalence in information services can be traced to three features:
- Many information services involve one-sided or two-sided network externalities.
- Information is a public good and the production and exchange of information between two parties may affect other parties in a positive or negative manner.
- Information services and physical infrastructures are complements.
Externalities arise in the two layers of the information society, the content level and the physical infrastructure. The proposal is then organized around four parts:
1. Background theory: two-sided markets, network dynamics, contractual externalities
2. Virtual layer: recommendation systems, privacy, transaction costs
3. Physical layer: pricing , investment
4. Competition policy for two-sided markets

The first part consists of the development of relevant theory with original and novel methods including for instance global games, coordination games and recent contract theory. The second part studies specific issues in information services such as the design of search engines and the right to privacy. It also includes empirical investigation of on-line transaction costs using proprietary data of transactions on e-commerce platforms. The third part is concerned with the infrastructure. It studies net-neutrality and the prices of data from the perspective of price theory, accounting for the gratuity of some services. It will also develop original dynamic investment models to understand the role of the complementarity between infrastructure and service innovation and the role of legacy. The last part will develop tools for competition policy makers.

Field of science

  • /social sciences/economics and business/business and management/commerce
  • /social sciences/economics and business/economics
  • /social sciences/economics and business
  • /social sciences/sociology/governance/public services
  • /social sciences/economics and business/business and management/commerce/e-commerce

Call for proposal

ERC-2014-ADG
See other projects for this call

Funding Scheme

ERC-ADG - Advanced Grant

Host institution

FONDATION JEAN JACQUES LAFFONT,TOULOUSE SCIENCES ECONOMIQUES
Address
5E Etage, 1 Esp De L'universite
31080 Toulouse
France
Activity type
Research Organisations
EU contribution
€ 1 815 938

Beneficiaries (1)

FONDATION JEAN JACQUES LAFFONT,TOULOUSE SCIENCES ECONOMIQUES
France
EU contribution
€ 1 815 938
Address
5E Etage, 1 Esp De L'universite
31080 Toulouse
Activity type
Research Organisations