Microeconomic Policies in the New Economy

This survey emphasizes innovation-intensive competition, strong technological scale economies, switching costs, network effects and complementarity between system components as characteristic features of the core industries in the information economy. With reference to these features the study explores how to design welfare-improving microeconomic policies, in the form of competition policies, technology policies or combinations of these, in the digital economy. In particular, a number of prevalent business practices typical of the digital economy are evaluated from the point of view of a microeconomic policy perspective.