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Does Envelopment through Data Advantage Call for New Regulation?

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  • Gregor Langus
  • Vilen Lipatov

Abstract

Envelopment is an effective form of market entry that facilitates competition among platforms. Nevertheless, many commentators have focused on the anticompetitive potential of envelopment, and some have argued for regulation of platforms because of that concern. These calls for regulation are not supported by robust formal analysis or comprehensive empirical evidence. We analyze a visible recent contribution by Condorelli and Padilla (2020a,b) and explain why the model that they put forward is not ripe for policy advice in relation to concerns with envelopment.

Suggested Citation

  • Gregor Langus & Vilen Lipatov, 2021. "Does Envelopment through Data Advantage Call for New Regulation?," CESifo Working Paper Series 8932, CESifo.
    • Handle: RePEc:ces:ceswps:_8932
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp8932.pdf
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    References listed on IDEAS

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    1. repec:bre:wpaper:45784 is not listed on IDEAS
    2. Gregor Langus & Vilen Lipatov, 2022. "Value Creation by Ad-Funded Platforms," CESifo Working Paper Series 9525, CESifo.

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    More about this item

    Keywords

    envelopment; entry deterrence; data; competition of multi-market platforms;
    All these keywords.

    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General

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