How platform cooperatives can redress abuses of authority within digital markets

Abstract

After their advent, digital platforms were hailed as innovative institutional solutions capable of reducing transaction costs for a wide group of stakeholders by removing traditional intermediaries and facilitating the match of demand and supply through digital means. However, a group of big investor-owned platforms from Silicon Valley soon imposed themselves as monopolistic actors within digital markets, leveraging their strong bargaining position to abuse their authority and extract undue rents. Different legal strategies have been assessed in the last few years to limit this unilateral rule-setting power, particularly at the EU level. Nevertheless, little consideration has been given to alternative forms of platform organising, aimed at including the relevant stakeholders in the governance of platforms to redress power abuses. This article presents the case of platform cooperatives, which are platforms owned and governed by their workers and users. Moreover, the article considers the institutional complementarities that could help platform co-ops overcome challenges and compete with capitalist platforms on fair legal and political bases.