Economics of Self-Preferencing Practices and Regulations Evaluated by Analysis Group Authors
November 18, 2022
The term “self-preferencing” refers to a set of behaviors whereby intermediaries that sell goods or services from a number of providers favor their own products over those of third parties. With the growth of digital platforms, regulators and government officials in the US and abroad have become increasingly concerned that some self-preferencing practices by platforms may violate antitrust laws or regulations, and have launched investigations into some of these practices.
In an article published in the California Lawyers Association journal Competition, Analysis Group academic affiliate Christopher Knittel, Vice President Juliette Caminade, and Associate Juan Carvajal provide an economic analysis of the self-preferencing debate. They begin by surveying a number of the at-issue practices and some of the regulations intended to address them. They then take a historical view, examining why such practices have come under increased scrutiny in the digital age when the same practices have not raised similar concerns previously. Finally, the authors review recent economic research on the effect of self-preferencing practices and proposed regulatory responses on consumer welfare, in order to shed light on the possible effect of regulating these practices.
The article, “An Economic Analysis of the Self-Preferencing Debate,” appears in the Fall 2022 issue of Competition.
Read an analysis of the intersection of self-preferencing and pricing by Professor Knittel and Dr. Caminade in the American Bar Association newsletter The Price Point