Enhancing Competition with Data and Identity Portability

POLICY PROPOSAL 2018-10 | JUNE 2018

Enhancing Competition with Data and Identity Portability

Joshua Gans

The Hamilton Project ? Brookings i

MISSION STATEMENT

The Hamilton Project seeks to advance America's promise of opportunity, prosperity, and growth. We believe that today's increasingly competitive global economy demands public policy ideas commensurate with the challenges of the 21st Century. The Project's economic strategy reflects a judgment that long-term prosperity is best achieved by fostering economic growth and broad participation in that growth, by enhancing individual economic security, and by embracing a role for effective government in making needed public investments. Our strategy calls for combining public investment, a secure social safety net, and fiscal discipline. In that framework, the Project puts forward innovative proposals from leading economic thinkers -- based on credible evidence and experience, not ideology or doctrine -- to introduce new and effective policy options into the national debate. The Project is named after Alexander Hamilton, the nation's first Treasury Secretary, who laid the foundation for the modern American economy. Hamilton stood for sound fiscal policy, believed that broad-based opportunity for advancement would drive American economic growth, and recognized that "prudent aids and encouragements on the part of government" are necessary to enhance and guide market forces. The guiding principles of the Project remain consistent with these views.

ii Enhancing Competition with Data and Identity Portability

Enhancing Competition with Data and Identity Portability

Joshua Gans

Rotman School of Management, University of Toronto

JUNE 2018

This policy proposal is a proposal from the author(s). As emphasized in The Hamilton Project's original strategy paper, the Project was designed in part to provide a forum for leading thinkers across the nation to put forward innovative and potentially important economic policy ideas that share the Project's broad goals of promoting economic growth, broad-based participation in growth, and economic security. The author(s) are invited to express their own ideas in policy papers, whether or not the Project's staff or advisory council agrees with the specific proposals. This policy paper is offered in that spirit.

The Hamilton Project ? Brookings 1

Abstract

Users contribute information to many digital platforms. Regulators have recognized that when such data cannot be easily moved between platforms, this may lock those users in to incumbent platforms and prevent innovative competitors from emerging. I argue that the same type of barriers exists with respect to networks of users. Users who move between platforms could lose the benefits of communications within their social network. I therefore propose to generalize data portability to a broader notion of identity portability, whereby messages (i.e., communications and content intended to be shared with other users) between verified connections can flow between platforms, thereby mitigating these broader switching costs and promoting competition.

2 Enhancing Competition with Data and Identity Portability

Table of Contents

A B S T R AC T

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CHAPTER 1. INTRODUCTION

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CHAPTER 2. THE CHALLENGE

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CHAPTER 3. THE PROPOSAL

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CHAPTER 4. QUESTIONS AND CONCERNS

17

CHAPTER 5. CONCLUSION

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AUTHOR AND ACKNOWLEDGMENTS

20

ENDNOTES

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REFERENCES

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The Hamilton Project ? Brookings 3

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