One of the central phenomena of the digital economy is the growing importance of digital platforms. Digital platforms are online intermediaries that facilitate, manage, and specifically control exchange and interaction between participants who are affiliated with the platform (e.g., buyers and sellers of products or services).

When users interact through a platform, they often lack information about who they interact with, and the quality of the goods and services provided. For example, a buyer on eBay may not know in advance whether the seller will ship the product or whether the product meets the proclaimed quality. This asymmetric information can lead to adverse selection or, in extreme cases, market failure, ultimately risking the platform’s viability. Therefore, managing the quality of participants is crucial for the success of digital platforms.

In this seminar, students will explore the economic principles underlying the need for quality management on digital platforms, examine how platforms design and implement rating and reputation systems to help high-quality sellers signal their credibility, and how platforms can manage disputes between participants. Moreover, students will learn about the impact of fake reviews and strategies to incentivize buyers to provide honest and genuine feedback, ensuring the reliability of reputation systems.

In this master's seminar, students will explore the design choices digital platforms make to shape user behavior and interactions. Discussions will highlight both positive and negative implications, as well as regulatory efforts to combat consumer manipulation. Topics include exploring the influence of dark patterns on decision-making and competition in platform ecosystems, methods of nudging users to generate content on a platform, the impact of ranking manipulation, analyzing the implications of the European Digital Services Act, and understanding the impact of platform design on filter bubbles. Students will prepare one topic in depth for their seminar thesis and engage in discussions with other students, fostering an opportunity to learn about digital platforms, consumer behavior and the regulatory landscape.

Digital platforms such as Amazon, Google or Instagram have become an essential part of our lives. Digital platforms are internet-based intermediaries that enable, facilitate, orchestrate and specifically control the exchange and interaction between participants who join the platform (e.g. users, providers of products or services). Consumers can use a search engine on their smartphone to find a nearby restaurant, use a ridesharing app instead of driving there in their own car, and pay the driver and for the meal via a payment provider of their choice. When consumers use these platform services, they allow the operators to collect and use their (personal) data. In return, many digital platforms offer their services for free. Platforms use this data to generate profit. Perhaps the best-known example is the use of data to sell targeted advertising. In other cases, the platform operator can use data to
improve the services it offers, for example by reducing consumers' search costs through personalised content.
One key feature that has enabled the rise of platforms in the first place is network effects. Network effects occur when the use of a product or service by one person directly or indirectly influences the appeal of the same product or service for others. Network effects lead to a ‘winner-takes-all’ dynamic, which has led to a concentration of user attention online on very few providers. These so-called ‘gatekeepers’ have unprecedented data collection capabilities. Given the data-centric nature of the services offered by platforms, unequal access to data can distort market power, and the resulting imbalances can lead to unfavourable market outcomes for consumers (e.g. excessive data collection) and businesses (e.g. inflated prices).
In response to such concerns, regulators around the world have taken measures to curb the abuse of market power by digital platforms. For example, regulations such as the General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA) or the Chinese Human Resources Information Protection Law (PIPL) aim to provide greater user privacy. The European Digital Markets Act prescribes ‘do's and don'ts’ for platforms vis-à-vis commercial users and competing platforms in order to limit their market power. Similar regulations are currently being developed in the US and China.
Against this background, the seminar ‘Digital Platform Ecosystems’ gives students an understanding of the fundamental economic mechanisms that operate in the context of digital platforms. In particular, the seminar covers topics related to personal data protection, online advertising, reputation systems and vertical integration.

Digital platforms are of central importance for the digital economy. Digital platforms are internet-based intermediaries that enable, facilitate, manage and control the exchange and interaction between participants who affiliate themselves with the platform (e.g. users, providers of products or services). A digital platform thus forms the core of a dynamic ecosystem made up of a multitude and diversity of actors. In eight of the ten most highly valued companies currently on the market – including Alibaba, Alphabet, Amazon, Apple, Facebook, Microsoft and Tencent – digital platforms are a mainstay of corporate strategy. Digital platforms differ fundamentally from traditional models of organisation and value creation, among other things because platform ecosystems have a particularly large number of interfaces between the actors and are based on the collection, analysis and exploitation of data and the utilisation of (often indirect) network effects. Digital platforms thus have far-reaching and potentially profound opportunities and risks for the economy and society.

In the seminar ‘Digital Platform Ecosystems’, students learn about the fundamental mechanisms of digital platforms and examine selected aspects of the digital platform economy in detail. Aspects that are examined in more detail in the seminar include data collection and data protection, competition and innovation in data-driven markets, online advertising markets, algorithmic control of platforms, platform governance and regulation of platforms.

Governments across the world are increasingly regulating how firms collect and use the personal data of consumers. For example, the European General Data Protection Regulation (GDPR), which came into effect on May 25, 2018, greatly strengthened individuals’ rights regarding their data. This includes granting consumers the right to data portability and the right to be forgotten among others.

In this seminar, the economic consequences of data protection regulation will be discussed. Topics include the effects of data protection laws on the ability to trade and generate economic value from data, the effects of transparency regarding privacy practices, and alternatives to data protection regulation such as industry self-regulation or data protection tools. Some of the topics will have to be written in English.

• Data broker
• The value of data
• Data as a public good
• Data ownership for personal and non-personal data
• Data sharing among competitors
• Incentives and barriers of data sharing