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The impact of consumer protection in the digital age: Evidence from the European Union

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  • Rösner, Anja
  • Haucap, Justus
  • Heimeshoff, Ulrich

Abstract

We investigate the effect of an EU-wide consumer protection regulation on consumer trust as well as consumer behavior. The Unfair Commercial Practice Directive (UCPD) was implemented by EU member states between 2007 and 2010. We utilize data from the Special and Flash Eurobarometer for the years between 2006 and 2014 and experts’ evaluation on consumer protection levels before the introduction of the regulation. This rich data set allows us to apply a difference-in-difference estimator with multiple time periods. We find a significant relationship between the introduction of the UCPD and consumer trust and cross-border purchases for countries with a low consumer protection level before the introduction of the UCPD. The relationship increases over time and stays then relatively constant.

Suggested Citation

  • Rösner, Anja & Haucap, Justus & Heimeshoff, Ulrich, 2020. "The impact of consumer protection in the digital age: Evidence from the European Union," International Journal of Industrial Organization, Elsevier, vol. 73(C).
    • Handle: RePEc:eee:indorg:v:73:y:2020:i:c:s0167718720300072
    DOI: 10.1016/j.ijindorg.2020.102585
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    Cited by:

    1. Dinh, Van & Le, Dao-Van & Duong, Duy & Pham, Dung, 2023. "Determinants affecting digital financial consumer protection: Evidence from 135 countries," The Journal of Economic Asymmetries, Elsevier, vol. 27(C).

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    More about this item

    Keywords

    Consumer protection; UCPD; B2C; E-commerce; Consumer trust; Cross-border purchase;
    All these keywords.

    JEL classification:

    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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