GDPR and the Lost Generation of Innovative Apps

Rebecca Janßen, Reinhold Kesler, Michael E. Kummer, Joel Waldfogel

Using data on 4.1 million apps at the Google Play Store from 2016 to 2019, we document that GDPR induced the exit of about a third of available apps; and in the quarters following implementation, entry of new apps fell by half. We estimate a structural model of demand and entry in the app market. Comparing long-run equilibria with and without GDPR, we find that GDPR reduces consumer surplus and aggregate app usage by about a third. Whatever the privacy benefits of GDPR, they come at substantial costs in foregone innovation

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Year of publication:	May 2022
Authors:	Janßen, Rebecca ; Kesler, Reinhold ; Kummer, Michael E. ; Waldfogel, Joel
Institutions:	National Bureau of Economic Research (issuing body)
Publisher:	Cambridge, Mass : National Bureau of Economic Research
Subject:	Google LLC \| Mobile Anwendung \| Mobile application \| Markteintritt \| Market entry \| Marktaustritt \| Market exit \| Digitale Dienste \| Web-based service \| Digitale Plattform \| Digital platform \| Datenschutz \| Data protection \| EU-Staaten \| EU countries

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