I can't say I buy this argument? I think for some of the cases (like Uber?) it might be correct, but are they sure there isn't another force at play in a lot of other cases?
I recall reading that with apartment rentals in NYC, the problem was (is?) apparently that there are literally contracts in place preventing landlords from deviating from the recommendation. That's the crux of the problem, not the app recommendation itself.
Are we sure the causes in these cases aren't analogously different? For example, the part about 97% of a market being controlled by one company sounds like a monopolization issue rather than anything to do with an app.
Did you read the article? The claim is that the app acts as a smokescreen to hide collusion. Or rather, it’s a new way to collude, and thus works as an obfuscation tactic. The app itself is immaterial: it’s using the technology as a way to dodge the law. In this case, w have laws against price fixing. Using an app for price fixing is a way for the price fixer to say, hey, it’s not me, it’s this other company that tells me pricing.
Seriously? I read the entire damn article before posting. That's why you see my comment had "the part about 97%" in it. It's referring to what was in the article. Was this really necessary?
> it’s using the technology as a way to dodge the law. In this case, we have laws against price fixing. Using an app for price fixing is a way for the price fixer to say, hey, it’s not me, it’s this other company that tells me pricing.
And I was telling you I don't buy this. Because if someone can make more money from defecting from the coordination strategy, they absolutely will. Unless, you know, 97% of the market is owned by one player. Or unless the parties can legally prevent each other from defecting. Or unless they can just blatantly collide illegally because law enforcement is lazy. Etc.
I gave you an actual example. The rental thing in NYC has a contractual price enforcement mechanism that is the real culprit. Why the heck do you think they include that provision if merely having an app was enough to fix prices and obfuscate it?
I recall reading that with apartment rentals in NYC, the problem was (is?) apparently that there are literally contracts in place preventing landlords from deviating from the recommendation. That's the crux of the problem, not the app recommendation itself.
Are we sure the causes in these cases aren't analogously different? For example, the part about 97% of a market being controlled by one company sounds like a monopolization issue rather than anything to do with an app.