Seminar  |  07/18/2018 | 12:00 PM  –  01:30 PM

Brown Bag Seminar: Digital Markets, Mobile Payments Systems and Development – Competition Policy Implications in Developing Countries in Light of the EU Experience

Jörg Hoffmann and Francisco Beneke (joint work with Mor Bakhoum) - on invitation

Max Planck Institute for Innovation and Competition, Munich, Room 313


The digitization of economic activity has important socio-economic development implications and at the same time creates challenges for antitrust analysis. These implications and challenges have been met differently in jurisdictions around the world.  We analyze the different experiences in the EU and developing countries, focusing on mobile payments. We find that this market exhibits special characteristics that need to be taken into account in the analysis of competition conditions. First, it is enabled by mobile telecommunications infrastructure and is offered by network operators, which causes competition in both markets to be closely linked. Second, there is still regulatory arbitrage which potentially favors mobile payments. Third, there are factors, such as the lack of interoperability and geographical reach, that make network effects in this industry different from those present in other platforms. Fourth, since mobile payments in developing countries serve a niche—the population underserved by mainstream banking—the definition of the relevant market is not straightforward. We propose the criteria to be applied when making such definition. Finally, since mobile payments have associated financial services, there is an interaction between competition and financial stability that needs to be considered.

Note: This seminar will be of interdisciplinary character and follow a novel format – following a 30min introductory presentation by Jörg and Paco, we will focus on the economic aspects of the project during the discussion.

Contact: Zhaoxin Pu