The Recoupment Conundrum: Rethinking Predatory Pricing in the Age of Algorithms
ISBN
978-1-954750-42-5
Type
book section
Date Issued
2024-09-25
Author(s)
Editor(s)
Alden Abbott
Thibault Schrepel
Abstract
This chapter examines the challenge of predatory pricing in the context of artificial intelligence (AI), focusing on the assessment of recoupment. In US law, recoupment requires a high burden of proof, demonstrating a dangerous probability, while EU law generally presumes its possibility for dominant firms. The rise of AI in pricing strategies disrupts these frameworks by enabling dominant firms to target specific customer segments with below-cost prices, minimizing predation losses and facilitating recoupment. This challenges the US’ stringent requirements and the EU’s cost-based analysis. The chapter concludes that artificial intelligence necessitates a reevaluation of competition law concepts. As sophisticated artificial intelligence tools make recoupment easier to achieve, a potential convergence between US and EU approaches to recoupment might become likely. However, both jurisdictions may need to adapt their frameworks to effectively address the nuances of predatory pricing in the era of algorithmic pricing strategies
Language
English
Book title
Artificial Intelligence and Competition Policy
Publisher
Concurrences