Digital platforms and development: Risks to competition and their regulatory implications in developing countries

Abstract

Digital platforms contribute significantly to sustainable development yet pose specific risks to developing countries. Using a World Bank global database of antitrust actions complemented by secondary data, we empirically analyze developing countries' regulatory responses to threats to competition and innovation associated with digital platforms. We ask: (1) Which types of anticompetitive agreements and abuse of dominance practices were associated with various platform types? (2) For mergers, which salient characteristics of the acquiring platform drove the antitrust investigations, and what actions were taken by the enforcement authorities? We find that two types of platforms (transaction and hybrid) give rise to distinct competitive concerns and elicit different responses from enforcement authorities. We then discuss our findings in the broader context of policy responses from developing countries to challenges related to digital platforms. We offer recommendations for policymakers and suggest avenues for future research.

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