Identifying the Exclusionary Effect of Across-Platform Parity Agreements: Testing the Tests

摘要

Although across-platform parity agreements (APPAs) are increasingly scrutinized, their exclusionary effects remain ambiguous. This article posits that the practice can either prevent entry or lead to the exit of rival platforms. Assessing this foreclosure effect presupposes, however, using one of the available tests, namely, the no economic sense test, the as efficient competitor test, and the consumer welfare test. Whether APPAs lead to the foreclosure of rivals depends ultimately on the applied test and, sometimes, on the way the test is applied. This reflects the paradox of APPAs. In an effort to identify the most appropriate test to deal with APPAs’ foreclosure effect, this article also suggests that the consumer welfare test is far superior to the others.