Abstract
The comparative capitalism literature examined how institutions vary on a national or societal level and how these differences affect multinational companies’ strategies. Yet, little attention has been devoted to cross-national or regional differences in the governance of competition, especially in the context of digitalization of markets. The article seeks to fill this gap by looking at the case of Google. It traces the process of the stark US–EU disagreement over Google’s abuse of dominant position in digital markets, which resulted in one of the largest fines in the EU history. It is argued that the variation in the response to the company’s market and nonmarket strategies are traced back to differences between Ordoliberal and Chicago School ideas, which are embedded in the ‘competition regimes’ of European and US capitalist models. The article concludes by discussing the implications of these findings for varieties of capitalism frameworks.
Highlights
A large body of comparative literature examined how institutions vary on a national level and how these affect multinational companies’ strategies (Hall and Soskice, 2001; Jackson and Deeg, 2008; McCann, 2013)
The article argues that the divergent outcome in the case of Google is in large part explained by the Ordoliberal and Chicago principles that underpin the EU and US competition regimes, respectively
The US competition authorities’ response to Google In June 2011, the Federal Trade Commission (FTC) received a complaint filed by a number of vertical search engines (‘VSE’) of which several are US-based, such as Amazon, eBay, Nextag, Expedia, TripAdvisor and Yelp; and EU-based, such as Foundem (FTC, 2012)
Summary
A large body of comparative literature examined how institutions vary on a national level and how these affect multinational companies’ strategies (Hall and Soskice, 2001; Jackson and Deeg, 2008; McCann, 2013). This line of inquiry suggested that the multinationals’ ability to navigate institutional complexity is key to their success or failure; and their decisions on how to respond to institutional differences are very much strategic ones (Ahmadjian, 2016). The article argues that the divergent outcome in the case of Google is in large part explained by the Ordoliberal and Chicago principles that underpin the EU and US competition regimes, respectively
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