policymakers demonstrate

Competition and Regulation in Markets for Goods and Services 197
important in competition policy practice. In fact, NCAs in different EU member
states have reached decisions that appear to be moving in opposite directions,
especially in the area of vertical pricing practices, indicating that a more solid
scientific basis would be useful for the comprehension and analysis of such
cases.
In addition to competition policy objectives, a stated core goal in the EU is the
promotion of the ‘single market’. 6 This objective is often served by the application
of competition and other policy measures, however, it is often viewed as
a goal in itself. It can be interpreted in a narrower or a broader way. The narrower
way is that all buyers should have access to products and services on the
same terms, regardless of the member state where they reside. In close relation
to the topic of this chapter, the Single Digital Market objective has been set
by the European Commission (EC) as one of its top priorities, as also detailed
in its May 2015 Communication, 7 while the Commission launched at the same
time an antitrust competition inquiry into how the e-commerce sector functions
in the EU. The inquiry, as already announced by Competition Commissioner
Margrethe Vestager in March, will allow the Commission to identify possible
competition concerns affecting European e-commerce markets. 8 While making
this issue a priority appears a reasonable policy choice, interpreting the single
market objective as a way to eliminate all price discrimination practices is likely
too narrow an approach and not based on solid economic principles. Economic
analysis does not always offer clear predictions about the welfare effects of
price discrimination. If the single market objective is understood to mean uniform
prices across all EU areas, then that would be an extreme view; after all,
prices are not typically the same even within the same country. Prohibiting price
discrimination may not lead to everyone having access to the goods or services
at the lower possible price, which is often implicitly assumed. Instead it is possible
that it may lead to some markets not being served at all, which would be
contrary to the single market principle.
Overall, while in this chapter we are motivated by some important recent
cases and emphasize new aspects of how markets work and the need for new
research, we also wish to stress the continuity that should exist both in the economics
analysis and in competition policy: when moving forward to applications
in new markets, ignoring past research is not an appropriate way to proceed.
Many of the issues that surface as important in digital markets are not
absent in other markets and therefore (should) have also already been studied
in some way. However, the difference in scale is often so dramatic that
from a practical viewpoint the priorities for what matters, the nature of how
the market forces interact and the application of policy analysis, is often perceived
as a completely different market environment. The challenge therefore
is to try to identify the new elements that play the key role for each case.
Online travel agencies, for example, make searching for a hotel reservation a