a column by Alberto Bailin Rivares, Peter Gal, Valentine Millot and Stéphane Sorbe for VOX: CEPR’s Policy Portal
While the innovative features of online platforms offer the potential to improve the performance of service sectors, they raise many new challenges for policymakers.
Using Google search data on service industries in ten OECD countries, this column shows that platforms generally stimulate the productivity of incumbent service firms, but the impact crucially depends on the type of platform considered. Productivity gains tend to be lower when a platform is persistently dominant on its market, suggesting that the contestability of platform markets should be promoted in order to maximise their economic benefits.
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