When two networks interconnect, one network may value the connection more than the other. In an unregulated environment, the direction of payment for interconnection depends on whether there are increasing or decreasing marginal returns to network size. If users face decreasing marginal returns...

The formation of consumer expectations for digital products affects competition between digital platforms that offer competing products. Unfair competition may occur if the competitive outcome is influenced my misled expectations, notably if the company that wins the competition either misled...

Much government policy focuses on improving the supply-side conditions of product rivalry, but policymakers rarely address the potential beneficial impacts of improving the demand-side conditions of rivalry. This paper suggests that focus on such demand-side elements can yield substantial...

This paper explores the impact of competition on inequality by developing a new model to illustrate how higher profits from market power, and associated higher prices, could influence the distribution of wealth and income. We analyse data from eight OECD countries – Canada, France, Germany,...

Some policies drive economic growth, some act to redistribute income or wealth; however, it is rare to find policy instruments that do both. Investment in improving skills and education may fall into that category. New research from the OECD suggests that competition can also help governments to...

The underlying concept of a “natural” monopoly is that costs for a given output are minimized when one firm produces that output. This paper shows that a paradox arises for certain infrastructure and delivery products satisfying widely accepted technical criteria for such monopolies: Under...