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Data Science for Entrepreneurship Research

Most of my recent research studies the consequences of datafication (the recent rise of big data and artificial intelligence) on markets, politics, organizations, and societies. This time it’s different. In “Data Science for Entrepreneurship Research: Studying Demand Dynamics for Entrepreneurial Skills in the Netherlands,” a working paper co-authored with Patricia Prüfer, we describe the most prominent data science methods suitable for research in the social sciences (here: applied to the domain of entrepreneurship) and provide links to literature and Internet resources for self-starters. We survey how data science methods have been applied in the entrepreneurship research literature.

As a showcase of how to use data science techniques, based on a data set of 95% of all job vacancies in the Netherlands over a 6-year period with 7.7 million data points, we provide an original analysis of the demand dynamics for entrepreneurial skills. We find that both entrepreneurial and digital skills are in increased demand for managerial positions in the Netherlands over the entire period 2012-2017. We also find (less surprisingly) that due to the hugely growing importance of datafication, amongst digital skills, those on ‘Digital transformation’ and ‘Big data and analytics’ are most valued by managers’ employers (less so for other professions). What is surprising, however, is that one could expect that demand for digital skills would increase most. Our empirical results, however, show the opposite: entrepreneurial skills were significantly more relevant over the six-year period studied. Moreover, the absolute importance of this skill type in managerial job vacancies has increased even more than digital skills.

Call for Papers: Workshop on “Governance of Big Data and AI”

Datafication has massively influenced processes within organizations, on markets, and more generally throughout society. Machine learning pushes the loop between data accumulation and innovation even further. The Tilburg Law and Economics Center (TILEC) and the Governance and Regulation Chair (GovReg) at University Paris-Dauphine | PSL Research University are pleased to announce the 5th Economic Governance workshop, which will take place at Tilburg University, the Netherlands, on June 6-7, 2019.

We now strive to stimulate the debate about the economic, political, legal, and social effects of big data and artificial intelligence. As a case of special focus, algorithm-driven platforms such as social media, search engines, and news aggregators have become dominant players in news dissemination. This has transformed the media sector and the way we think about democratic political elections and the legitimacy of those elections’ outcomes, with yet unknown consequences for our political systems and for many markets that are tipping towards the technological leader.

These developments challenge our rules of the game: are Western institutions, formal and informal, set up appropriately to ensure fair competition among firms, innovators, politicians, or political parties? What does it mean for competition law, privacy and data access laws, international treaties, election commissions’ procedures, and the codes of conduct on online platforms if most of us can be traced and monitored most of the time – but these masses of data can only be accessed, worked with, and potentially be manipulated by a few parties? Are we heading towards a future with virtually unbounded opportunities and progress for humanity – or towards a setting, where the state or large private actors control every aspect of life and the net profits of global technological progress are enjoyed by very few very rich and influential individuals?

The deadline for submissions is January 20, 2019. Details and further information are here.

What is the problem of Cloud Computing? – And how can we mitigate it?

Cloud computing technologies can increase innovation and economic growth considerably. Empirical studies have shown, however, that many users underutilize cloud technologies because of privacy concerns. Individuals do not fully trust that their personal pictures, for instance, don’t leak if put to the cloud for once. Firms do not trust that their critical business applications run smoothly and that their business secrets are kept safe if stored on servers that can be mirrored or changed over night.

Trusting Privacy in the Cloud” addresses these concerns. In that paper, which is forthcoming in Information Economics and Policy, I design an institution attenuating the trust problem in cloud computing: a two-layered certification scheme built around a private, nonprofit organization called cloud association. This association is governed by representatives of both users and cloud service providers and sources auditing and certification of providers out to independent for-profit certifiers. It is shown how this institution incentivizes providers to produce high data security, and users with strong privacy preferences to trust them and pay a premium for their services. The theoretical proposed mechanism is compared with procedures in an existing organization. Suggestions for how to improve the existing one are made.

MSc Economics at Tilburg University voted best of its kind in NL

For the Beste Studies 2018 survey, weekly newspaper Elsevier has compared 2,181 programs in Dutch higher education (research universities and universities of applied sciences). The Beste Studies ranking is largely based on assessments by students of their program in the National Student Survey (NSE 2018). These assessments were supplemented with practical information, such as student population and academic success rates.

The MSc Economics at Tilburg University, which I am involved in, came out on top of all MSc Economics programs in the country this year.

Rank University Score (satisfaction %)
1 Tilburg University
Vrije Universiteit Amsterdam
3 University of Groningen 71
4 Maastricht University
Radboud University
Erasmus University*
7 University of Amsterdam 61
* Erasmus University’s program is accredited as Economics and Business, therefore it is officially not a part of this ranking.

This result is especially satisfying because last year our score was 69. It is good to read that the combination of a high-quality program with a very international classroom (and heterogeneous student experiences) and a distinct customer/student-orientation are acknowledged.

Now, back to work …



TILEC on “Shaping competition policy in the era of digitization”

A team of researchers at TILEC, the Tilburg Law and Economics Center, has submitted a contribution responding to a call issued by the European Commission’s Directorate-General for Competition (DG COMP) on on “Shaping competition policy in the era of digitization.” The call elicits contributions from interested stakeholders that can inform the discussion at a conference DG COMP organizes in January of 2019.

According to DG COMP, the conference is “designed to provide input to the Commission’s ongoing reflection process about how competition policy can best serve European consumers in a fast-changing world. The conference may also help to identify problems and solutions as markets go through rapid changes. The objective is to identify the key upcoming digital challenges and their implications for competition policy.”

TILEC’s contribution revolves around the three panels that will be featured at the conference: (1) competition, data, privacy and AI, (2) digital platforms’ market power, (3) preserving digital innovation through competition policy. It summarizes recent research undertaken by TILEC researchers in these fields and derives implications for competition policy.




Interdisciplinary Workshop on Relational Contracts at U Chicago

Lisa Bernstein (Chicago Law School), together with a formidable set of other scholars, organizes a fascinating meeting next week, where the ins and outs of relational contracting and transacting in the shadow of the law will be discussed. Promises, rules, social norms, property rights, productivity, and incentive contracts combine a range of topics relevant for relationships where the future matters. The program is populated by exquisite legal scholars, economists, and political scientists. For a glimpse, click here!


Mandated data sharing in data-driven markets

My recent work with Cedric Argenton and Christoph Schottmueller on competition in data-driven markets had some policy impact (details here). The key proposal we put forward and analyzed in those theory papers was to require competitors in data-driven markets to share their user information – data about the preferences and characteristics of users gained as a virtually free byproduct of offering certain services, e.g. search engines or online platforms.

Now ESB, a Dutch economic policy outlet, published an entire special issue on such mandated data sharing. Naturally, authors from different backgrounds disagree about the right measures to prevent monopolization of markets. Together with legal scholar Inge Graef, a colleague at the Tilburg Law and Economics Center (TILEC), I explain the original reasoning in a nutshell and discuss policy implementation options, both from a legal and an economic perspective. Our 4-page essay, a bit sensationally called “Mandated data sharing is a necessity in specific sectors,” is here. Financieele Dagblad, a Dutch (language) daily newspaper, wrote about it here.