Impact of Reverse Globalization on the Competition in EU Digital Markets
Keywords:
Reverse Globalisation, Digital Markets, Economic Development, Covid-19, Competition Policy
Abstract
This paper aims to analyze the relationship between reverse globalization, the digital markets, and competition policy within the EU. Based on the review of contemporary literature, this paper provides an insight into the EU adaptation to the changes caused by the Covid-19 pandemic. Reverse globalization is identified through the trends in the international trade and FDI flows, while the digital markets' development is evaluated through the Number of individuals using the Internet to order goods and services and E-Commerce sales. While this paper uses secondary data sources, it uniquely connects the identified reverse globalization and digital markets expansion with necessary changes in the competition policy pre and during the Covid-19 pandemic. Additionally, this paper provides policymakers and business owners with relevant information and possible avenues to improve the competition policy and business strategy.
References
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Preta, A. (2018). Platform Competition in Online Digital Market. Social Science Research Network. doi:10.2139/ssrn.3272839.
Prüfer, J. (2020). Competition Policy and Data Sharing on Data-driven Markets. Tilburg University.
Schiliro, D. (2020). Towards digital globalization and the covid-19 challenge. University Library of Munich, Germany.
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Ancarani, A., & Di Mauro, C. (2018). Reshoring and Industry 4.0: how often do they go together?. IEEE Engineering Management Review, 46(2), 87-96.
Andersen, T. M., & Herbertsson, T. T. (2003). Measuring globalization. Available at SSRN 434540.
Antràs, P. (2020). De-Globalisation? Global Value Chains in the Post-COVID-19 Age (No. w28115). National Bureau of Economic Research.
Ashby, A. (2016). From global to local: reshoring for sustainability. Operations Management Research, 9(3), 75-88.
Calvano, E., & Polo, M. (2020). Market power, competition and innovation in digital markets: A survey. Information Economics and Policy, 100853.
Chen, S. S., & Hsu, K. W. (2012). Reverse globalization: Does high oil price volatility discourage international trade?. Energy Economics, 34(5), 1634-1643.
Coeurderoy, R., & Yang, X. (2020). A perspective on impact of covid-19 on European business: The risks of de-globalization and the promises of regionalization. Managing a Post-Covid19 Era, 229.
Costa-Cabral, F., Hancher, L., Monti, G., & Ruiz Feases, A. (2020). EU Competition Law and COVID-19. TILEC Discussion Paper No. DP2020-007, Available at SSRN: https://ssrn.com/abstract=3561438 or http://dx.doi.org/10.2139/ssrn.3561438
Delis, A., Driffield, N., & Temouri, Y. (2019). The global recession and the shift to re-shoring: myth or reality?. Journal of Business Research, 103, 632-643.
Drexl, J. (2017). Economic efficiency versus democracy: On the potential role of competition policy in regulating digital Markets in Times of post-truth politics. Competition Policy: Between Equity and Efficiency, Cambridge: Cambridge University Press, 2017
Enderwick, P., & Buckley, P. J. (2020). Rising regionalization: will the post-COVID-19 world see a retreat from globalization?. Transnational Corporations Journal, 27(2).
European Commission. (2020a, March). Guidance to the Member States concerning foreign direct investment and free movement of capital from third countries, and the protection of Europe's strategic assets, ahead of the application of Regulation (EU) 2019/452 (FDI Screening Regulation). Retrieved February 20, 2021, from https://trade.ec.europa.eu/doclib/docs/2020/march/tradoc_158676.pdf
European Commission. (2020b, December). Digital Markets Act: Ensuring fair and open digital markets. Brussels: European Commission. Retrieved February 20, 2021, from https://ec.europa.eu/commission/presscorner/detail/en/QANDA_20_2349
EUROSTAT. (2021a). Euroa area international trade in goods surplus €25.8 bn. Retrieved February 1, 2021, from https://trade.ec.europa.eu/doclib/docs/2013/december/tradoc_151969.pdf
EUROSTAT. (2021b). Individuals Using the Internet for Ordering Goods and Services. Retrieved February 7, 2021, from https://ec.europa.eu/eurostat/product?code=ISOC_EC_IBUY&mode=view
EUROSTAT. (2021c). E-Commerce Sales. Retrieved February 7, 2021, from https://ec.europa.eu/eurostat/databrowser/bookmark/442ef850-5acc-4090-a24b-85ac599b34b7?lang=en
Fratocchi, L., Di Mauro, C., Barbieri, P., Nassimbeni, G., & Zanoni, A. (2014). When manufacturing moves back: Concepts and questions. Journal of Purchasing and Supply Management, 20(1), 54-59.
Free, C., & Hecimovic, A. (2020). Global supply chains after COVID-19: the end of the road for neoliberal globalization?. Accounting, Auditing & Accountability Journal.
Hammes, T. X. (2016, July). Will technological convergence reverse globalization?. In Strategic Forum (No. 297, p. 1). National Defense University Press.
Irwin, D. A. (2020, April 23). The pandemic adds momentum to the deglobalization trend. Realtime Economic Issues Watch. Peterson Institute for International Economics. Retrieved February 20, 2021, from https://www.piie.com/blogs/realtime-economicissues-watch/pandemic-adds-momentum-deglobalization-trend
Kerber, W. (2016). Digital markets, data, and privacy: competition law, consumer law and data protection. Journal of Intellectual Property Law & Practice, 11(11), 856-866.
Kinkel, S. (2012). Trends in production relocation and backshoring activities. International Journal of Operations & Production Management.
KPMG. (2020, March). EU measures in response to COVID-19. Retrieved February 9, 2021, from https://home.kpmg/xx/en/home/insights/2020/03/etf-427-eurogroup-covid-19-update.html
Merriam-Webster. (n.d.). Globalization. In Merriam-Webster.com dictionary. Retrieved February 7, 2021, from https://www.merriam-webster.com/dictionary/globalization
Meunier, S., & Mickus, J. (2020). Sizing up the competition: explaining reform of European Union competition policy in the Covid-19 era. Journal of European Integration, 42(8), 1077-1094.
Palomino, F. (2019, October). Hipster Antitrust, the European way? How to tackle concentration in digital markets. Paper presented at the Fourth Annual Conference of the Florence Competition Programme.
Popovic, A. & Milijic, A. (2020, October) Impact of Reshoring in Industry 4.0 on Economic Development in the Wake of Covid-19 Crisis. Paper presented at the International Scientific Conference Digital Economy: Chances, Risks, and Sustainable Development, Niš, Serbia.
Popović, A. (2020). Implications of the Fourth Industrial Revolution on sustainable development. Economics of Sustainable Development, 4(1), 45-60.
Preta, A. (2018). Platform Competition in Online Digital Market. Social Science Research Network. doi:10.2139/ssrn.3272839.
Prüfer, J. (2020). Competition Policy and Data Sharing on Data-driven Markets. Tilburg University.
Schiliro, D. (2020). Towards digital globalization and the covid-19 challenge. University Library of Munich, Germany.
Schwab, K. (2016). The Fourth Industrial Revolution. Switzerland. World Economic Forum.
Setser. B.W. (2007, March). Reverse Globalization. Council on Foreign Relations. Retrieved February 20, 2021, from https://www.cfr.org/blog/reverse-globalization
Stanojević, N. (2020). Deglobalization of the World Economy and its Effects on the Western Balkan Countries. Economic Themes, 58(3), 343-362.
Statista. (2020, April). Biggest Companies in the World 2019. Retrieved February 8, 2021, from https://www.statista.com/statistics/263264/top-companies-in-the-world-by-market-capitalization/
Sułkowski, Ł. (2020). Covid-19 pandemic; recession, virtual revolution leading to de-globalization?. Journal of Intercultural Management, 12(1), 1-11.
UNCTAD. (2019). Competition issues in the digital economy. New York: United Nations Conference on Trade and Development
UNCTAD. (2020a). World Investment Report 2020. New York: United Nations Publications.
UNCTAD. (2020b, December). COVID-19 drives large international trade declines in 2020. Retrieved January 25, 2021, from https://unctad.org/news/covid-19-drives-large-international-trade-declines-2020
UNCTAD. (2021a). Goods and services (BPM6): Trade openness indicators, annual. Retrieved January 25, 2021, from https://unctadstat.unctad.org/
UNCTAD. (2021b, January). Global foreign direct investment fell by 42% in 2020, outlook remains weak. Retrieved February 1, 2021, from https://unctad.org/news/global-foreign-direct-investment-fell-42-2020-outlook-remains-weak#:~:text=Global%20foreign%20direct%20investment%20(FDI,Monitor%20published%20on%2024%20January.&text=The%20organization%20had%20projected%20a,last%20year's%20World%20Investment%20Report.
UNCTAD. (2021c). Foreign Direct Investments: Inward and Outward flows and stocks. Annual. Retrieved January 25, 2021, from https://unctadstat.unctad.org/
Van Gorp, N. & Batura, O. (2015). Competition Policy in the Digitalised Economy. Challenges for Competition Policy in a Digitalised Economy. Brussels: European Union.
Voitau, I. V., & Novikova, I. V. (2019). Economics digitalization as a base for changing the globalization model: trends and challenges. Труды БГТУ. Серия 5: Экономика и управление, 1 (220).
WTO. (2019). Report on G20 Trade Measures. WTO OMC. Retrieved February 5, 2021, from https://www.wto.org/english/news_e/news19_e/g20_wto_report_june19_e.pdf
WTO. (2020). Report on G20 Trade Measures. WTO OMC. Retrieved February 5, 2021, from https://www.wto.org/english/news_e/news20_e/report_trdev_jun20_e.pdf
Yaya, S., Otu, A., & Labonté, R. (2020). Globalization in the time of COVID-19: repositioning Africa to meet the immediate and remote challenges. Globalization and Health, 16(1), 1-7.