Mudit Dhakar - Research

Working Papers

Interoperability & Privacy: The Case of Messaging Apps ( joint with Jun Yan ) - Job market paper

This theoretical paper investigates mandated interoperability between messaging services. We consider a situation in which a high-privacy paid niche app competes with a low-privacy free app with a large installed user base. Consumers vary in privacy concerns and can multi-home across different apps. We find that niche app users may end up being harmed by partial privacy-preserving interoperability relative to no interoperability. Moreover, full interoperability may not necessarily promote market contestability, especially when privacy concerns significantly outweigh network benefits. We find a mismatch between the low-privacy app's incentives for interoperability and the surplus of niche app users, suggesting that mandating a specific level of interoperability is essential for policy. Our results remain robust even in an interoperability setting which leads to privacy loss simply by opting in to it.

Keywords: Interoperability, Compatibility, Multi-homing, Messaging Apps, Network Effects, Privacy, Regulation, Digital Markets Act

Numerical Analysis in R

Work in Progress

Welfare Effects of Decarbonising Aviation by Taxes ( joint with Marc Ivaldi and Miguel Urdanoz )

This empirical paper is concerned with aviation being a major environmental challenge as it is four times as polluting as a high-speed rail in emissions per seat-km over short-haul routes. It accounts for 3% of global CO2 emissions, Since the technological solutions to handle this issue are still far away, we focus on market-based measures as a short-term solution. Specifically, we focus on the design of airport charges. We develop a structural model of airports as a 2-sided market/platform with passengers and airlines being the two sides. We collect public data in the US aviation market as well as premium data on airport charges. We estimate how elastic consumers are given prices and how airlines react to taxes they face. We use this analysis to implement airport charges in two forms: on a per-flight basis and on per per-passenger basis. Our flexible approach allows us to study various types of policy objectives. For instance, a regulation to reduce carbon emissions by a certain percentage point from each airport would result in what type of airport charges and how will this end up affecting consumers, airlines and airports themselves and how this compares with regulators imposing taxes directly on consumers and airlines.

Keywords: Pollution, Decarbonisation, Airport charges, Two-Sided Markets, Ramsey Prices, Regulation

Data Sharing In Innovative Markets

This theoretical paper considers products with two-dimensional quality: one derived from data-based learning and another based on the level of standalone innovation. By allowing firms to compete on these dimensions, we study the implications of data-based learning on the incentives to invest in standalone quality in a two-period model and show that the investment by the data-lagging firm increases as data dominance shrinks. We then study the effects of a non-stochastic data-sharing policy. While the policy always improves upon the innovation level, it can reduce consumer surplus in certain cases and we provide sufficient conditions for cases where consumer surplus improves.

Keywords: Data sharing, Innovation, Regulation, Digital Markets Act