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Algorithms And The Competitive Ideal

Author

Listed:
  • Aleksandar Todorov

    (University of Economics - Varna, Varna, Bulgaria)

Abstract

Do modern digital algorithms contribute to more competition? The paper at hand answers this question by looking at the competitive effects of some of the most common algorithms on the Internet. At first glance, search, comparison, recommendation, and evaluation algorithms seem to bring markets closer to the competitive ideal, but a closer look reveals that they also create several distortions to competitive behavior. On the supply side, the increasingly common application of pricing algorithms bears the risk of collusive behavior. The solutions offered so far - consumer protection algorithms and an active competition policy are only partial and still immature.

Suggested Citation

  • Aleksandar Todorov, 2020. "Algorithms And The Competitive Ideal," Economic Science, education and the real economy: Development and interactions in the digital age, Publishing house Science and Economics Varna, issue 1, pages 147-158.
    • Handle: RePEc:vrn:cfdide:y:2020:i:1:p:147-158
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    File URL: https://ue-varna.bg/~uevarna/uploads/filemanager/303/publishing-complex/2020/Economic_science_education_real_economy_T2_2020.pdf
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    More about this item

    Keywords

    algorithms; competition; collusion;
    All these keywords.

    JEL classification:

    • D41 - Microeconomics - - Market Structure, Pricing, and Design - - - Perfect Competition
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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