K2SP 3285 - The Platform Economy: Microeconomics and Macroeconomics of Digital Markets

The objective of this course is to analyze the economics of digital markets. The class will study the main economic characteristics of digital markets, analyze firms' strategies in these markets, discuss potential market failures and whether and how public authorities should intervene, and the consequences of the platform economy in terms of economic development. It will cover relevant theoretical and empirical material in economics, and discuss case studies in class. Students will learn economic concepts useful to understand and analyze the digital economy. The course will begin with a description of the role of network effects in digital markets, and analyze the economics of multi-sided platforms. Then, it will consider the pricing and non-pricing strategies and business models of platforms. We will develop examples of specific platforms. We will focus on the importance of data and network effects in those strategies. Next, the class will review the impact of those strategies on competition and discuss how public policies and regulation need to adapt. We will eventually question the macroeconomic impact on economic development, labor markets and inequalities and the environment issues.

Maya BACACHE-BEAUVALLET

Cours magistral seul

English

There is no specific pre-requisite for the course. Some knowledge of microeconomics and/or industrial organization and economic simple mechanisms will help.

Spring 2021-2022

The course will be evaluated on the basis of 1. small quiz tests online (40%), 2. a case study presentation on digital platform business (30%) by a group of two or three students, 3. a short written note (2 pages) on a specific issue (30%) and participation during the sessions (up to 2 bonus points).

The class format will consist of lectures, student presentations and debates. We will adapt to the online constraints and use various formats to try and keep interactions.