Valerie Reif and Nicolò Rossetto (Florence School of Regulation, European University Institute): “The energy sector in the digital age: new transactions and governance needs” [06/05] – https://youtu.be/z-ociQIS9gI
Abstract: The Internet was meant to be neutral: treat all traffic the same, without discriminating in favor of specific apps, sites, or services. As commercial interests threaten this ideal, many countries have introduced neutrality regulations. Unfortunately, none of them are actually enforceable. In this talk, I will first discuss the challenge of inferring whether a network is neutral or not using solely external observations. Then, I will discuss how we can go beyond neutrality inference and reach network transparency, in which networks provide explicit hints that enable their users to reliably assess network behavior, including neutrality.
Katerina Argyraki is an associate professor of computer science at EPFL, where she does research on network architecture and systems, with a particular interest in network transparency and neutrality. She received an IRTF applied networking research prize (2020) and Best Paper awards at SOSP (2009) and NSDI (2014), all shared with her students and co-authors. She has been honored with the EuroSys Jochen Liedtke Young Researcher Award (2016) and three teaching awards at EPFL. Prior to EPFL, she worked at Arista Networks from day one, and received her PhD from Stanford (2007).
Net Neutrality and High-Speed Broadband Networks: Evidence from OECD Countries
Abstract: Network neutrality regulations are intended to preserve the Internet as a non-discriminatory, public network and an open platform for innovation. Whereas the U.S. recently reversed its regulations, thus returning to a less strict regime, the EU has maintained its course and recently revised implementation guidelines for its strict and rather interventionist net neutrality regulations. To this day, there exist only a few U.S.-focused empirical investigations on the impact of network neutrality regulations, based on rather broad measures of investment activities. Our paper provides the first estimation results on the causal impact of net neutrality regulations on new high-speed (fiber-optic cable-based) infrastructure investment by Internet service providers and on related consumer subscription to fiber-based broadband connection services. We use a comprehensive OECD panel data set for 32 countries for the period from 2003 to 2019 and various panel estimation techniques, including instrumental variables estimation. Our empirical analysis is based on theoretical underpinnings derived from a simplified model in a two-sided market framework. We find empirical evidence that net neutrality regulations exert a direct negative impact on fiber investments and an indirect negative impact on fiber subscriptions. Our results suggest that imposing strict net neutrality regulations slow down the deployment of new fiber-based broadband connections.
Dr. rer. pol. habil. Wolfgang Briglauer is Head of the Digitalization and Regulation Research Section at EcoAustria and PostDoc researcher at the Institute for Regulatory Economics at the Vienna University of Business and Economics (WU). His research focus is on economic and empirical issues concerning the digital revolution, broadband policies, industrial economics, and regulation.
Briglauer studied Economics at Johannes-Kepler-University in Linz, earning his doctorate in 2001 with honours. From 2000 to 2009, he supported the Austrian Regulatory Authority for Broadcasting and Telecommunications (RTR) in Vienna and was responsible for issues concerning the market definition, market analysis, and sectoral ex-ante regulation. From 2000 to 2009 (and again since 2018), he was (is) a researcher at the Institute for Regulatory Economics at the Vienna University of Business and Economics (WU), where his empirical research is focused primarily on electronic communication markets. From 2013 to 2019, Briglauer was a Senior Researcher at the Centre for European Economic Research (ZEW Mannheim) in the research groups „Competition and Regulation“ and „Digital Economy“. He obtained his Habilitation (university teaching credential) in Economics from the Technical University of Ilmenau in January 2021. Briglauer has also been a regular lecturer in Microeconomics at WU and FOM Mannheim from 2011 to 2018. Since 2020 Briglauer is lecturer and research affiliate at University of Passau (Chair of Internet and Telecommunications Business).
The research of Briglauer is regularly published in leading scientific journals in his field of expertise, among others International Journal of Industrial Organization, Industrial and Corporate Change, Journal of Common Market Studies, Journal of Regulatory Economics, Information Economics and Policy or Telecommunications Policy. From 2016 to 2019 Briglauer was part of the co-editorial team of Review of Network Economics. Briglauer is a member of the program committee of the International Telecommunications Society (ITS) since 2011.
New Cryptocurrency Indexes: UCRY; ICEA; CBDCUI and CBDCAI
Abstract: Using #BigData approach, we have developed and made available a new cryptocurrency indexes: Cryptocurrency Uncertainty Index (UCRY); Index of Cryptocurrency Environmental Attentions (ICEA); Central Bank Digital Currency Uncertainty (CBDCUI) andCBDC Attention Index (CBDCAI).Our UCRY Index captures two types of uncertainty: that of the price of cryptocurrency (UCRY Price) and uncertainty of cryptocurrency policy (UCRY Policy).ICEA captures the extent to which environmental sustainability concerns are discussed in conjunction with these new assets. While the most recent,the CBDC Uncertainty Index (CBDCUI) and CBDC Attention Index (CBDCAI) capture uncertainty and attention to CBDC. All indexes are news based and we show that the constructed indexes exhibit distinct movements around major events in cryptocurrency space. Learn how to use these indexes for academic and business purposes.
Dr Larisa Yarovaya is a researcher in International Finance and Financial Technologies (Fintech), with specialism in interconnectedness between financial markets, contagion and spillover effect, diversification, hedging and safe haven properties of new markets, including cryptocurrencies, green, and Islamic assets. Larisa has published her research in peer-reviewed academic journals, such as Journal of Corporate Finance; Journal of Financial Stability; Energy Economics; International Review of Financial Analysis, and European Journal of Finance among others. She also co-edited the book “Cryptocurrency and Blockchain Technology” and organises the annual Cryptocurrency Research Conference. To date, Larisa has published 40 papers in top academic journals and has become one of the most cited female authors in the Fintech and cryptocurrency research area.
How will Quantum Computing change the technology landscape?
Abstract: Quantum computing is reaching the point at which it is possible to perform computations that are nearly impossible for classical computers. In 2019, Google published results claiming quantum supremacy—completing in minutes a task that would take thousands of years on a classical computer. This talk will explain in simple terms how quantum computers work, how they differ from classical computers, and what they are potentially capable of. While there are enormous technical challenges still to overcome, there is great promise for quantum computers in such fields as molecular modeling, optimization and machine learning. There are also some important implications for computer security in the area of cryptography. We aim to dispel a few myths about quantum computers and provide a basis for understanding how they may impact the world in years to come.
Bruce Davie is a computer scientist noted for his contributions to the field of networking. He recently co-founded (with Larry Peterson) Systems Approach, LLC, to produce open source books and educational materials. He is a former VP and CTO for the Asia Pacific region at VMware. He joined VMware during the acquisition of Software Defined Networking (SDN) startup Nicira. Prior to that, he was a Fellow at Cisco Systems, leading a team of architects responsible for Multiprotocol Label Switching (MPLS). Davie has over 30 years of networking industry experience and has co-authored 17 RFCs. He was recognized as an ACM Fellow in 2009 and chaired ACM SIGCOMM from 2009 to 2013. He was also a visiting lecturer at the Massachusetts Institute of Technology for five years. Davie is the author of multiple books and the holder of more than 40 U.S. Patents.
Consumer Reviews and Regulation: Evidence from NYC Restaurants
Abstract: We investigate how two signals of restaurant quality, hygiene grade cards and online reviews, affect consumer choice and restaurant hygiene. Unlike hygiene cards, online reviews contain information about multiple dimensions of restaurant quality. To extract signals of hygiene from online reviews, we exploit the fact that health inspectors look for different types of violations and we apply machine learning methods to predict the occurrence of individual violations from review text. Using out-of-sample prediction accuracy as a measure of signal informativeness, we find substantial heterogeneity in how informative reviews are about different violations. Reviews are more informative about food handling and pest violations than facilities and maintenance violations. Next, we estimate the effect of hygiene information contained in online reviews on consumer demand and restaurant hygiene choices. We find that consumer demand is more sensitive to more informative signals of hygiene. In addition, restaurants that are reviewed online are more likely to comply with hygiene standards for which online reviews provide a more informative signal. Our results have implications for the allocation of limited regulator resources when consumers rate service providers online.
Georgios Zervas is an Associate Professor of Marketing at Boston University Questrom School of Business and a founding member of the Faculty of Computing & Data Sciences. Previously, he was a Simons Postdoctoral Fellow at Yale University, and an Affiliate at the Center for Research on Computation and Society at Harvard University. Georgios holds a PhD in Computer Science at Boston University. Georgios works on problems at the intersection of marketing, computer science, and economics, and much of his work has focused on large scale empirical studies of internet markets.
Platform Duality and Network Externalities
Abstract: The dual role of gatekeeping platforms has attracted the attention of policymakers worldwide. In this paper, we rationalize the incentive of a platform to enter in direct competition with third parties with a product bundle. When network externalities are absent, the platform adopts a dual role and competes with third parties in most cases and this benefits user. When network externalities are present, platform duality emerges less often. Duality reduces prices while fragmenting demand across services and reducing the network benefits. When network externalities are large, the total impact of duality on consumers is negative even if prices fall. This paper suggests that ignoring the role of network externalities might bias any meaningful analysis in favor of duality.
Axel Gautier has a PhD in economics from the University of Louvain and he is now Professor at the Department of Economics of HEC Liège – Management School of the University of Liège. Axel Gautier is the cofounder and an active member of the Liege Competition and innovation Institute (LCII), an interdisciplinary research center. In his research, Axel Gautier focuses on the digital economy with recent contributions related to mergers in the digital economy, net neutrality and the dual role of gatekeeping platforms.
Digital Markets Act: Shaping A New Pro-Competitive Modality of EU Competition Rules
Abstract: An unprecedented revision of the rules regulating the functioning of competition in the digital markets has catalysed diverse reactions among the main stakeholders. The proposed approach to regulating gatekeepers will have a paradigmatic impact on European consumers, businesses and public institutions. It will have equally significant implications for the theoretical foundations of competition law, economics and policy.
While formally the proposed Digital Markets Act (DMA) is complementing, not substituting, existing provisions of competition, such a substantial extension of the rationale and instruments of competition policy is likely to have significant implications also for the application of ex-post rules. The entire apparatus of competition law will be extended by the new modality.
On one hand, such an extension may be seen as an enrichment. For decades, the great variety of the ideas about economic competition and its regulation have been substantially narrowed down and standardised by the Law & Economics analysis. On the other hand, however, the proposed recalibration is likely to raise many additional issues and challenges for the discipline.
Out of the wide spectrum of changes introduced by the DMA proposal, this presentation identifies and analyses one of the central – though not so commonly discussed – elements of the transformation. It asks a normative question about what kind of competition in the digital markets the European Union should seek to establish, and amethodological question about procedural and substantive legal mechanisms used for shaping such a new format.
Oles Andriychuk (PhD, European University Institute, Florence; Charles University in Prague) is a Senior Lecturer in Competition and Internet Law at the School of Law, University of Strathclyde, Glasgow. He also is Co-Director ofStrathclyde Centre for Internet Law and Policy (SCILP) and Member of the Strathclyde Centre for Antitrust Law and Empirical Study (SCALES). In his research, Dr Andriychuk focuses on competition in the digital markets, intersections between competition law and legal philosophy, and the constitutional foundations of economic competition. His recent book “The Normative Foundations of European Competition Law: Assessing the Goals of Antitrust through the Lens of Legal Philosophy” has been published with Edward Elgar in 2017 and is available here: https://www.e-elgar.com/shop/gbp/the-normative-foundations-of-european-competition-law-9781786436061.html
Platform Mergers and Antitrust
Abstract: Should Internet era merger policy differ from Industrial era merger policy? Platform ecosystems rely on economies of scale, data-driven economies of scope, high quality algorithmic systems,and strong network effects that frequently promote winner-take-most markets. Their market dominance has generated competition concerns that appear difficult to assess with traditional merger policy tools. This paper examines the acquisition strategies of the five major U.S. platforms—Google, Amazon, Facebook, Apple, and Microsoft—since their inception. We discuss the main merger and acquisition theories of harm and how these operate differently than in the past. To address M&A concerns of multi-sided platforms, we develop four proposals that incorporate (1) a new ex-ante regulatory framework, (2) an update of the conditions under which the notification of mergers should be compulsory and the burden of proof should be reversed, (3) differential regulatory priorities in investigating horizontal versus vertical acquisitions, and (4) an update of competition enforcement tools to increase visibility into market data and trends.
Geoffrey Parker is a professor of engineering at Dartmouth College and serves as Director of the Master of Engineering Management Program. He is also a research fellow at MIT’s Initiative for the Digital Economy where he leads platform industry research studies and co-chairs the annual MIT Platform Strategy Summit. He received a B.S.E. from Princeton and M.S. and Ph.D. from MIT. Parker has made significant contributions to the field of network economics and strategy as co-developer of the theory of “two-sided” markets. He is co-author of the book “Platform Revolution,” published in ten languages. Parker won the Thinkers50 2019 Digital Thinking Award, along with Marshall Van Alstyne, for the concepts of the inverted firm, two-sided markets, and how firms can adapt and thrive in a platform economy. In Spring 2020, he was elected as a Fellow of the Production and Operations Management Society. In Fall 2020 he joined the World Economic Forum’s Global Future Council on Advanced Manufacturing and Production. He also joined an expert panel of the European Commission to provide commentary and feedback on the proposed EU Digital Markets Act. Parker is a frequent keynote speaker and advises senior leaders on their organizations’ platform strategies. Speaking engagements are handled by the Stern Strategy Group.
Playlisting Favorites: Measuring Platform Bias in the Music Industry
Abstract: Platforms are growing increasingly powerful, raising questions about whether their power might be exercised with bias. While bias is inherently difficult to measure, we identify a context within the music industry that is amenable to bias testing. Our approach requires ex ante platform assessments of commercial promise – such as the rank order in which products are presented – along with information on eventual product success. A platform is biased against a product type if the type attains greater success, conditional on ex ante assessment. Theoretical considerations and voiced industry concerns suggest the possibility of platform biases in favor of major record labels, and industry participants also point to bias against women. Using data on Spotify curators’ rank of songs on New Music Friday playlists in 2017, we find that Spotify’s New Music Friday rankings favor independent-label music, along with some evidence of bias in favor of music by women. Despite challenges that independent-label artists and women face in the music industry, Spotify’s New Music curation appears to favor them.
Luis Aguiar is Assistant Professor in the Management of Digital Transformation in the Department of Business Administration at the University of Zurich, Switzerland. He holds a PhD in Economics from Universidad Carlos III de Madrid, an MSc in Economics, Finance and Management from Universitat Pompeu Fabra in Barcelona, and a Masters’ Degree in Economics from the University of Geneva, Switzerland. Prior to his appointment at the University of Zurich he was a Research Fellow in the Digital Economy Unit at the European Commission’s Joint Research Center in Seville, Spain.
His research focuses on the economics of digitization and online markets. His work relies on various econometric methods to analyze the effects of technological change on firms, consumers, markets, and welfare, with a particular focus on digital media products. His research has been published in leading academic journals, including the Journal of Political Economy, Information Systems Research, the Journal of Industrial Economics, and the International Journal of Industrial Organization. His research has also been covered by various news outlets, including The Economist, The Wall Street Journal, Forbes, CNBC, and Billboard Magazine. He is currently serving as a co-editor for Information Economics and Policy.
Data-Driven Approaches to Understanding Hateful Content and Moderation Interventions on the Web
Abstract: The Web has revolutionized the way people receive, consume, and interact with information. At the same time, unfortunately, the Web offers a fertile ground for amplifying socio-technical issues like the spread of hateful content and false information; hence there is a pressing need to develop techniques and tools to understand, detect, and mitigate these issues on the Web. In this talk, I will present our data-driven quantitative approach towards understanding such emerging socio-technical problems, focusing on the spread of hateful content targeting specific demographic groups. Also, I will present our work on understanding mitigation strategies employed by social networks (i.e., moderation interventions) and assessing their effectiveness towards reducing the prevalence and impact of these issues on the Web.
Savvas Zannettou is a Postdoctoral Researcher at Max Planck Institute for Informatics (MPI-INF), working under the guidance of Prof. Anja Feldmann and Prof. Krishna Gummadi. He is also a core member of the International Data-driven Research for Advanced Modeling and Analysis Lab (iDrama Lab). His research focuses on applying machine learning and data-driven quantitative analysis to understand emerging phenomena on the Web, such as the spread of false information and hateful rhetorics. His research has been published at top-tier conferences such as ICWSM and ACM IMC. He and his co-authors have received best/distinguished paper awards at ACM IMC 2018 and CyberSafety 2019.
Antitrust Welfare and Remedies for Platform Monopoly
Abstract: The goal of the antitrust laws should be to manage firm conduct and structure in a way that encourages maximum sustainable market output. Neoliberals, and Robert Bork in particular, did antitrust a considerable disservice by pushing for lower output solutions in the name of something that they misnamed “consumer welfare.” In fact, the antitrust-welfare enforcement curve is an inverted U, with both overderrent and underdeterrent rules leading to lower output, although for different reasons.
Digital platforms, even the large ones, are not winner take all markets; they need exclusionary practices in order to maintain dominance. As a result, properly tailored injunctions are often a promising way to control competition without interfering unreasonably with efficient operations. Another promising way is compelled interoperability, which can serve to extend positive network effects over a wider range and thus benefit rather than harm consumers and the other constituents who are affected by their behavior.
Herbert Hovenkamp is the James G. Dinan University Professor, Penn Law and the Wharton School, University of Pennsylvania. He is a Fellow of the American Academy of Arts and Sciences, and in 2008 received the Justice Department’s John Sherman Award for lifetime contributions to antitrust law. His principal antitrust scholarship includes Antitrust Law (with the late Phillip E. Areeda and the late Donald F. Turner, 1978-2021); and Federal Antitrust Policy: the Law of Competition and its Practice (6th ed. 2020). His legal history writing includes The Opening of American Law, 1870-1970 (Oxford, 2015); Enterprise and American Law, 1836-1937 (Harvard, 1991). For an expanded version of his views on antitrust policy and digital platforms, see Antitrust and Platform Monopoly, 130 Yale L.J. 1952 (2021).
The Data Governance Act – The Legal Perspective
Abstract: The proposal of the Data Governance Act is part of a broader EU policy initiative with respect to data regulation. As consequence of its data strategy, the EU has presented different regulative proposals. In this talk, the Data Governance Act shall be evaluated from a legal perspective.
Moritz Hennemann is a University Professor at the University of Passau Law Faculty, Germany, holding the Chair for European and International Information and Data Law. He is also the Director of the Research Center for the Law of Digitization at Passau Law Faculty. His research focuses mainly on the data-driven economy and its legal framework – especially with respect to Contract Law, Data (Protection) Law, Anti-Trust Law, and Media Law as well as Comparative Law. In Fall Term 2018, Moritz Hennemann was a Visiting Researcher at Harvard Law School. Before coming to Passau, he has conducted his research as a Post Doc at University of Freiburg Law Faculty.
Valerie Reif and Nicolò Rossetto
The energy sector in the digital age: new transactions and governance needs
Abstract: Digitalisation enormously increases the availability and usability of data in the energy system. By lowering transaction costs, digitalisation enables the coordination, based on market signals, of a growing number of energy assets connected to distribution grids like rooftop PV panels, batteries and heat pumps. Next to the traditional business-to-business transactions at the wholesale level (B2B) and to the likewise traditional business-to-consumer transactions at the retail level (B2C), new exchanges consumer-to-consumer (C2C) become possible. Thanks to digitalisation, individuals, small and medium-sized non-energy enterprises and other organisations can trade their surplus energy or activate demand response to provide flexibility to their peers or the energy system.
These new transactive energy models can take several forms and have important implications for energy regulation and policy. The European climate goal to reach net-zero greenhouse gas emissions by 2050, for instance, relies on the efficient and effective coordination of millions of devices across energy vectors and end-uses: C2C transactions can be a way to achieve such coordination and the following energy system integration.
Automated data exchange and interoperability are necessary to unleash the full potential of these disruptive models. However, appropriate governance for interoperability must be in place to deal with the fragmented ICT landscape in the energy sector and the lack of a customer-centric approach by traditional market players.
In this Plamadiso Talk, Nicolò Rossetto presents some of the forms in which new C2C transactions in the energy system can be organised. Later, Valerie Reif discusses the governance challenges raised by the need to secure a seamless exchange and interoperability of energy data.
Valerie Reif is a Research Associate in electricity regulation at the Florence School of Regulation, European University Institute in Italy. Her main research interests are energy data exchange, interoperability, and the EU Electricity Network Codes. She is involved in two H2020 research projects on TSO-DSO-consumer coordination (INTERRFACE, OneNet). Before joining FSR in September 2018, Valerie worked at the Technology Platform Smart Grids Austria. Valerie holds both a BSc and an MSc degree in Renewable Energy Engineering and a BA in European Studies.
Nicolò Rossetto is a Research Associate in electricity regulation at the Florence School of Regulation, European University Institute in Italy. His main research interests are the digitalisation of energy, energy communities, peer-to-peer energy trading, and the integration of renewables in the electricity sector. Before joining FSR in September 2016, Nicolò was an external advisor to the World Bank, founding member of the Energy Watch at ISPI (Milan) and teaching assistant at the University of Pavia (Italy). Graduated first in Political Science and then in International Economics, Politics and Institutions, Nicolò holds a PhD in Law and Economics.
Attention Economics of Instagram Stars: #Instafame and Sex Sells?
Abstract: Popular content providers on social media, so-called influencers, represent a novel star-type of the digital era. In contrast to stars of traditional media, they build their (rapidly growing) audiences within the system of social media platforms. This star-type creates stardom with uploads on social media pages like YouTube, TikTok or Instagram. One of the most popular platforms, especially designed to upload picture contents, is the service “Instagram” owned by Facebook. The growing social, cultural and economic power of this star phenomenon raises the question: What are key drivers of Instagram success? This paper empirically analyses 500 top Instagram stars within the categories (1) fashion and beauty, (2) fitness and sports, (3) music, (4) photo and arts, (5) food and vegan. The unbalanced panel data set consists of 100 stars within each category over an observation period of five months. The data (retrieved from Heepsy.com) provides information on popularity measurements, such as subscribers, likes and comments, and most importantly, price estimates per post. Since influencers are not paid by the platform, but mainly by advertisers for promotion of their products, the estimated price per upload is a valid proxy for income and economic success. Therefore, by the means of panel regression estimations, I can statistically analyse the influence of popularity factors and upload behaviour on income. Next to various control variables, I add a variable for body exposure, measuring the degree of nudity on the account. Combined with information on both (i) sex of the account and (ii) sex of the main target group, this gives interesting insights into consumption behaviour and preferences of social media users. The results reflect theoretical assumptions of attention economics and (sustainable) audience building; Instagram stars can strategically influence their success by specific upload behaviour.
Sophia Gaenssle (M.Sc.) is a junior researcher at the chair of Economic Theory at the Ilmenau University of Technology. She specialises in media and cultural economics, with particular emphasis on industrial organisation and digital markets.
When Does it Pay Off to Learn a New Skill? Revealing the Complementary Benefits of Cross-Skilling
Abstract of the corresponding working paper (https://arxiv.org/abs/2010.11841): This work examines the economic benefits of learning a new skill from a different domain: cross-skilling. To assess this, a network of skills from the job profiles of 14,790 online freelancers is constructed. Based on this skill network, relationships between 3,480 different skills are revealed and marginal effects of learning a new skill can be calculated via workers’ wages. The results indicate that learning in-demand skills, such as popular programming languages, is beneficial in general, and that diverse skill sets tend to be profitable, too. However, the economic benefit of a new skill is individual, as it complements the existing skill bundle of each worker. As technological and social transformation is reshuffling jobs’ task profiles at a fast pace, the findings of this study help to clarify skill sets required for designing individual re-skilling pathways. This can help to increase employability and reduce labour market shortages.
Fabian Stephany is a Researcher in Computational Social Science at the OII, University of Oxford, a Research Affiliate at the Humboldt Institute for Internet and Society in Berlin and a Research Fellow at the Wittgenstein Centre for Demography and Global Human Capital in Vienna. Fabian is interested in the application of computational social science in fields like digital skills, migration, innovation, and e-governance. With the iLabour project at the OII, he studies the global dynamics of Online Labour Markets. Fabian holds a PhD and degrees in Economics and Social Sciences from different European institutions, including Universitá Bocconi Milan and University of Cambridge. As an Economist and Senior Data Scientist, Fabian has been working in the private sector and for various actors in the international policy landscape, such as the United Nations Development Programme, the World Bank or the OECD in Paris.