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Saturday, September 21 • 10:08am - 10:40am
Data-Driven Market Power: An Overview of Economic Benefits and Competitive Advantages from Big Data Use

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Recent high-profile merger and antitrust cases as well as policy debates worldwide have centered around the relationship between the access to (big) data and the market power of firms in digital markets. These discussions have brought forward numerous con- ceptual arguments for and against the conjecture that market power may be derived from a firm’s access to big data. This study attempts to shed light on these arguments and makes the following contributions: First, we survey the economic, information systems and marketing literature and provide an overview of the empirical evidence on the eco- nomic benefits that firms derive from big data in the internet economy. Specifically, we focus on data-driven personalization and targeting and derive nuanced insights on how big data can benefit firms, while also highlighting moderating factors that significantly in- fluence economic outcomes. Second, we identify six facilitating factors that enable a firm to establish a sustained competitive advantage based on the economic benefits achieved from big data. These factors include structural market characteristics as well as business strategies that firms may pursue to strengthen their competitiveness. Third, we con- tribute to the current policy debate on market concentration and on how to deal with dominant data-driven firms. Based on the identified facilitating factors, we propose a set of escalating policy measures to address competitive concerns and anti-competitive conduct in the data economy.


Aleecia McDonald

Carnegie Mellon University


Victoria Fast

University of Passau
avatar for Daniel Schnurr

Daniel Schnurr

University of Passau

Michael Wohlfarth

University of Passau

Saturday September 21, 2019 10:08am - 10:40am PDT
Y116 WCL, 4300 Nebraska Ave, Washington, DC