The Promise and Perils of the Algorithm-Driven Economy
While consumers reap many benefits from online purchasing, the sophisticated algorithms and data-crunching that makes browsing so convenient are also changing the nature of market competition—and not always for the better. Long-standing laws may prevent companies from overtly fixing prices, but data-driven algorithms can now quickly monitor competitors’ prices and make adjustments accordingly. So what is seemingly beneficial—increased price transparency—ironically can end up harming consumers. Furthermore, merchants can use behavioral discrimination and, by tracking and profiling consumers, get them to buy goods at the highest price they are willing to pay. By controlling key platforms, data-driven monopolies can dictate the flow of personal data and determine who gets to exploit potential buyers.
One of the two thought-provoking authors of Virtual Competition, Maurice E. Stuck, closes this conference track in conversation with Mary Rasenberger, Executive Director of the Authors Guild, about what this means for books and authors. Topics that will be discussed include:
• To what extent will the “invisible hand” protect us?
• Will the upsurge of algorithms, Big Data and super-platforms hasten the end of competition as we know it?
• What does the “god’s-eye view” of the marketplace look like?
• Should we allow advanced technology to transfer wealth from customers to sellers?