Quantification of Antitrust Damages in Digital Markets

In a newly published chapter in the Research Handbook on Competition and Technology, Oliver März, together with Nicola Tosini and Francesco Decarolis, examines the unique challenges of quantifying antitrust damages in digital markets. The authors discuss how traditional approaches to damages estimation must be adapted to reflect the fast-evolving dynamics and behaviours characteristic of digital platforms. They also present practical principles for navigating these complexities, illustrated through a case study on mobile app distribution.

The views expressed in this chapter are the sole responsibility of the authors and cannot be attributed to Compass Lexecon or any other parties.

Abstract

Antitrust damages quantification consists in quantifying the causal effect that the defendants’ antitrust infringement had on the claimants’ welfare, which is defined as the difference between actual (observed) welfare outcomes and counterfactual (unobserved) outcomes. Estimating counterfactual outcomes is particularly challenging in digital markets because of: (i) the characteristics of such markets; and (ii) the type of anticompetitive behaviour that is alleged. In this chapter, we review the traditional conceptual and empirical framework for damage quantification, illustrate the challenges in applying this framework to the quantification of antitrust damages in digital markets and present best-practice principles to overcome these challenges. We close with the discussion of a case study to show how the principles presented can be applied to the quantification of damages arising from the alleged anticompetitive behaviour related to mobile app distribution.

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