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Attention Platforms, the Value of Content, and Public Policy

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  • David S. Evans

    (Global Economics Group
    Bloomsbury)

Abstract

This paper shows that two related aspects of attention platforms are important for the sound economic analysis of public policy including antitrust: first, attention platforms generate valuable content. Even though people often don’t pay for content, we know from revealed preference that content is valuable because people spend a considerable amount of time—which has an opportunity cost—consuming it. Second, demand for advertising and the supply of content are interdependent. A decrease in the demand for advertising reduces the returns to supplying content and therefore the amount of content that is provided. Accounting for the value of content and these positive feedbacks cannot determine optimal interventions; but failing to do so can result in policies that reduce consumer—as well as advertiser—welfare. The paper then considers the implications of these considerations for public policy: particularly privacy regulation and antitrust enforcement. From the standpoint of promoting consumer welfare, the failure to account for the value of content and the ad-content interdependencies increases the chances that authorities do not intervene when they should and do intervene when they should not.

Suggested Citation

  • David S. Evans, 2019. "Attention Platforms, the Value of Content, and Public Policy," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(4), pages 775-792, June.
  • Handle: RePEc:kap:revind:v:54:y:2019:i:4:d:10.1007_s11151-019-09681-x
    DOI: 10.1007/s11151-019-09681-x
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    Cited by:

    1. Shota Ichihashi & Byung-Cheol Kim, 2022. "Addictive Platforms," Staff Working Papers 22-16, Bank of Canada.
    2. Peitz, Martin, 2020. "Economic policy for digital attention intermediaries," ZEW Discussion Papers 20-035, ZEW - Leibniz Centre for European Economic Research.
    3. Steffen, Nico & Wiewiorra, Lukas & Kroon, Peter, 2021. "Wettbewerb und Regulierung in der Plattform- und Datenökonomie," WIK Discussion Papers 481, WIK Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste GmbH.
    4. Miller, Tracy, 2021. "Evaluating Arguments for Antitrust Action against Tech Companies," Annals of Computational Economics, George Mason University, Mercatus Center, May.
    5. Tim Meyer & Anna Kerkhof & Carmelo Cennamo & Tobias Kretschmer, 2022. "Competing for Attention on Information Platforms: The Case of News," CESifo Working Paper Series 9832, CESifo.

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