Abstract
Platform monopoly has attracted wide attention from politicians and the public.. The European Commission has made unremitting efforts in platform antitrust enforcement in the last decade, but together with antitrust investigations, the stock prices of platform giants like Google and Facebook keep breaking their highest points. At the end of 2020, the Chinese government also started antitrust investigations towards platform companies like Alibaba. In contrast, the stock price of Alibaba crashed and lost more than half of its market value. By analyzing their CAR, we proved that the stock performance of Alibaba is significantly worse than Google after their most serious antitrust investigations. The difference reflects investors' different expectations of the European Commission and China's antitrust enforcement. A noteworthy problem then comes out: while the Chinese government is seriously strengthening platform antitrust and putting forward reforms in platform regulation, is there any authority that is able to effectively regulate the international platform giants and maximize the welfare of their users worldwide?
Highlights
Since the 21st century, platform economy has gradually attracted people’s attention
The Chinese government fined Alibaba 18.2 billion RMB in 2021/4, since the case is relatively new, we only find a limited number of works around Alibaba, but it’s obvious that the papers around Alibaba have an idea in common, that the case of Alibaba is only a beginning; the Chinese government is going to take serious actions in platform antitrust enforcement
We proved that the stock performance of Alibaba is much worse than Google after the antitrust investigations and huge fines
Summary
Since the 21st century, platform economy has gradually attracted people’s attention. In a ranking list published by PwC in 2021, seven out of the ten biggest companies in the world are platform companies, including APPLE INC, the biggest company in the world, MICROSOFT, AMAZON, ALPHABET(Google) and META(Facebook), ranked from third to sixth, followed by two Chinese platform companies, TENCENT and ALIBABA. Since the end of 2020, the Chinese Administration for Market Regulation started antitrust investigations toward the platforms in China. After the European Commission’s investigations, especially after it fined Google €2.42 billion in 2017, there is a huge debate upon the rightfulness of antitrust penalty. After the Chinese administration’s punishment on Alibaba, most researchers recognize the case as a start of platform antitrust enforcement in China, and predict that more actions upon platform antitrust might follow. These differences indicate that the European Commission’s antitrust enforcement against international platform giants and the Chinese government’s antitrust enforcement against Chinese platforms are facing different situations. In Chinese academia, most scholars hold a positive attitude in strengthening platform antitrust enforcement and platform regulation, several reasons supporting this position are listed
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