In the first of two articles, Stavros Makris and Filip Lubinski discuss the connection between economic competition and democracy and how competition law allowed Big Tech to undermine both.
Big Tech’s unprecedented economic and informational power threatens not only market competition but also the basic infrastructure of democratic governance. By concentrating data, attention, and algorithmic control in a handful of dominant platforms, today’s digital economy risks sliding into a form of technofeudalism in which a few private actors set the rules for both markets and public debate and in which cloud capital reproduces itself through shaping market behavior and rent extraction rather than through labor or traditional productive investment. The standard neoclassical competition policy (NCP) paradigm, focused on consumer price metrics, is ill-equipped to confront how Big Tech’s data advantages, network effects, and AI-driven tools could undermine the informational foundations of democracy. Instead of treating platforms as ordinary firms, competition law must grapple with their ecosystemic power to suppress rivals, steer public discourse, and distort the marketplace of ideas. So far, it has failed to do so.
To address this challenge, it is useful to return to Adam Smith and the Ordoliberals, who helped shape the intellectual foundations of Europe’s social market liberal democracy. Their work uncovers a deep, historically rooted connection between competitive markets and democratic institutions: both are designed as safeguards against the concentration of power and as guarantors of republican freedom (freedom as non-domination). For Smith, monopolies and collusive practices not only undermine fair exchange but also erode trust and entrench social inequalities, ultimately posing risks that threaten political liberty and social justice. Markets, in his account, are valuable because in addition to creating national wealth, they also, when competitive, dismantle the“servile dependency” that characterize feudal societies (i.e., orders with rigid social hierarchies and inherited inequalities).
Ordoliberal thinkers built on these insights in the context of twentieth-century Europe’s democratic crises. Reflecting on the failures of Weimar Germany and the rise of authoritarianism, they argued that unchecked concentrations of economic power do not merely distort markets but can endanger the very fabric of democratic society by allowing private interests to capture public institutions. Competitive markets, in this perspective, are essential safeguards against political domination, with economic liberty forming both the foundation and counterpart of political freedom. Competition law thus appears as a constitutional tool: it is designed to secure individual autonomy and prevent public institutions from being subordinated to the interests of dominant firms.
Seen through this Smithian and Ordoliberal lens, the nexus between political and economic democracy becomes clear. The purpose of competition law cannot be reduced to promoting efficiency or maximizing consumer welfare. It must also preserve industrial liberty and prevent the accumulation of private regulatory power, especially in core infrastructures like digital platforms. In an age marked by democratic backsliding, geopolitical fragmentation, and the weaponization of data and information networks, this question becomes acute: how can the intrinsic link between competition and democracy be operationalized in the digital age, so that markets remain spaces of freedom rather than channels of domination?
Daniel Innerarity’s Theory of Complex Democracy (2025) offers a promising way to address this question. Innerarity suggests that democratic systems must be understood as complex, adaptive networks of institutions and practices that extend far beyond elections and parliaments. In such a setting, democracy requires pluralism, robust public spheres, and resilient infrastructures that can process conflict and uncertainty without collapsing into either technocracy or populist capture. Building on a growing body of work that treats competition as a complex evolutionary process rather than a static equilibrium, this perspective invites a rethinking of competition policy. By integrating insights from complexity science and the law and democracy literature, it becomes possible to sketch concrete ways in which competition law can engage with democratic harms by confronting private regulatory power in digital ecosystems, and by promoting diversity, resilience, and citizen-oriented welfare as core objectives of enforcement.
Five ways Big Tech threatens democracy
Drawing on interdisciplinary work in law, political theory, and economics, it is possible to identify five principal democratic harms arising from Big Tech’s strategic market positioning, dominance, and architectural power.
First, Big Tech firms can leverage network effects, economies of scale, and data advantages to entrench their dominance, expand influence in adjacent markets, raise barriers to entry, exercise ecosystemic power and stifle innovation and diversity. This erosion of competitive pressure undermines the pluralism that underpins both economic and political democracy, reviving concerns long emphasised by Ordoliberal thinkers about concentrated private power and its authoritarian potential. When competition no longer secures a diverse landscape of firms, markets cease to function as institutions of freedom in the Smithian sense and begin to resemble “data-feudal” structures, in which users and smaller businesses are locked into dependence on platform infrastructures and rules.
Second, the engagement-driven business models of major digital platforms encourage the manipulation of information, polarization, and the spread of misleading content. Algorithms designed to maximize attention frequently amplify disinformation, hate speech, and filter bubbles, thereby distorting the “marketplace of ideas” and eroding the conditions for well‑informed democratic participation. For instance, in 2016–2017, Facebook’s algorithms played a pivotal role in enabling an ethnic-cleansing campaign in Myanmar by amplifying content that incited violence, hatred, and discrimination against the Rohingya. At that time, incendiary content was produced by humans, and the platform’s responsibility lay primarily in promoting it or failing to stem its spread. Today, AI‑powered tools can autonomously learn strategies for generating and disseminating sophisticated, false, and polarizing political messages, intensifying these risks and further blurring the line between persuasion and covert manipulation. As dominant platforms consolidate their position through exclusionary conduct or acqui-hires focused on artificial intelligence, they not only deepen their control over information flows but also reduce the scope for alternative infrastructures and business models that might mitigate these democratic harms.
Third, Big Tech’s accumulation and exploitation of user data enables microtargeting, behavioral manipulation influencing elections, and the creation of detailed personal profiles that can influence political processes, including elections, by controlling what information individuals see and how they interpret public issues. Such surveillance practices and data exploitation not only entrench market power but also undermine citizens’ agency and autonomous decision‑making, which are fundamental preconditions for a functional democracy. In addition to their data and brand advantages, dominant firms control critical assets, application programming interfaces (APIs), and digital infrastructure, allowing them to shape interoperability, restrict access, and hard‑wire dependencies into the technical architecture of digital markets.
Fourth, major platforms, due to their market and ecosystemic power, increasingly act as private regulators of digital spaces, governing speech, access, and economic participation without meaningful democratic oversight. By designing and enforcing rules that determine which voices are amplified or silenced, platforms increasingly replace markets as public domains with algorithmically governed private spaces, where actors with “cloud capital” (i.e., intangible and data-driven assets, digital infrastructures) exercise de facto private regulatory power. Content moderation and platform governance decisions can significantly affect civic rights, freedom of expression, and the functioning of democratic institutions, thus highlighting how platforms increasingly resemble “private governors” rather than neutral intermediaries. For example, in early 2024, Meta changed its defaults so that political content, including election-related posts, is no longer proactively recommended to most users unless they opt in. These changes are widely understood to reduce the algorithmic visibility of political actors, including candidates, for many users, since their content is less likely to appear in recommendation surfaces by default.
Fifth, Big Tech’s influence extends beyond the marketplace to reshape legal and political institutions, threatening core principles and processes of democratic governance. Evidence shows that major technology firms deploy extensive financial and organizational resources to shape legislation, lobby against stricter antitrust enforcement, and steer regulatory agendas, thereby weakening checks and balances and tilting policymaking in their favor. Companies such as Uber have gone further by directly mobilizing their user base through in-app tools. When the “DeBlasio” app, named after the New York City mayor who proposed capping the number of Uber vehicles, was launched, Uber added a feature to its app enabling users to instantly register their opposition with city officials at the touch of a button.
The limits of neoclassical competition policy
Despite its refinements over time, the NCP still abstracts from the complex realities of digital markets and struggles to grasp the critical phenomena of technofeudalism, private regulatory power, and tech oligarchy discussed earlier. By focusing primarily on static or narrowly defined dynamic efficiency, the NCP overlooks crucial dimensions of competition, including innovation diversity, market contestability, and pluralism, while underestimating newer forms of economic power: ecosystemic, informational, architectural, and private regulatory power. In doing so, it fails to capture how Big Tech entrenches its ecosystemic dominance and undermines vital mechanisms of democratic accountability, from market contestability and media plurality to electoral integrity, and the shaping of public policy through lobbying.
By neglecting private regulatory power and the ways in which ecosystems become self‑reinforcing, the NCP overlooks Big Tech’s broader influence on democratic structures and processes. By nudging competition law to focus almost exclusively on output metrics or stylized claims about market dynamism, the NCP risks legitimizing Big Tech’s structural dominance. A more viable solution requires moving beyond economic and political simplism and adopting a responsive approach, integrating behavioral, evolutionary, and complexity economics to evaluate efficiency-centric policies. Insights from various disciplines, including studies on dynamic competition, are crucial for addressing the growing dominance of powerful ecosystems across multiple digital markets.
Commentators across the political spectrum now recognize that competition law is inherently value-laden and have grown sceptical of the neoclassical competition policy, whether in its static or its dynamic guise (see here and here). As argued here, protecting “effective competition” in the 21st century can and should incorporate democratic considerations alongside more familiar consumer welfare concerns. A note of caution is, however, essential. There may be cases where innovation and democracy pull in different directions: Big Tech undeniably generates significant innovation benefits from platform scale, data‑driven network effects, and tightly integrated ecosystems. Even if much of this innovation is sustaining rather than disruptive, it still merits protection and should not be casually sacrificed for speculative or weakly evidenced democratic gains.
The framework and operational proposals set out below are designed precisely to confront this tension. By articulating clear principles, legal standards, evidentiary thresholds, and enforcement strategies that are open to learning, revision, and recalibration, competition law can integrate democracy‑related concerns without needlessly undermining innovation. In the rare cases where genuine trade-offs between innovation and democracy do arise, the approach advanced here places a premium on transparency: decision‑makers should be clear about what they are doing, why they are doing it, whether the intervention is achieving its aims, and when the strategy ought to be reconsidered.
Beyond consumer welfare: a framework for democratic competition policy
Competition law can serve as a vital safeguard for democracy by securing key preconditions, such as autonomous economic decision-making, market contestability, plurality, diversity, and the empowerment of consumers as citizens, while curtailing Big Tech’s multifaceted power.
In A Theory of Complex Democracy, Innerarity argues that traditional democratic models, shaped in eras of relative social and political simplicity, are no longer adequate for the modern reality. Democratic systems must instead adapt to a complex world marked by dense interdependence, rapid technological change, and overlapping crises that cut across traditional policy silos.
Democracy is complex because it is an adaptive political system composed of values, institutions, and procedures that remain open to contingency and capable of evolving in response to shifting societal, technological, and geopolitical realities. The exponential growth of the digital economy intensifies these pressures and demands continual adjustment in public governance, from platform regulation to the protection of public spheres. To thrive under such conditions, democracy must reconcile ideals with material constraints, balance broad participation with inclusive deliberation, prioritize qualitative governance over quantitative metrics, and favor adaptive mechanisms over rigid institutional structures.
Innerarity, among others, argues that the political system should be understood as an ongoing, not static, process of collective self-government, exercised through a variety of procedures and institutional channels. This requires moving beyond simple, vertical relationships between leaders and the masses and embracing a higher degree of institutional complexity that enables diverse forms of participation, deliberation, and decision‑making. Such a perspective takes pluralism, heterogeneity, and the multiplicity of meanings and interests in society seriously and places its hopes in agile institutions capable of harnessing collective intelligence for problem-solving. Rethinking foundational concepts such as power, sovereignty, and representation is indispensable to sustaining democracy’s evolution in this context.
A Theory of Complex Democracy traces this evolutionary trajectory from the polis to today’s hyperconnected digital age and presents epistemic institutional adaptability as a condition of democratic survival. While democratic institutions have advanced in protecting private life, notably through data‑protection frameworks, they remain poorly equipped to defend public life, which is increasingly structured by digital infrastructures and dominated by Big Tech.
Innerarity also warns of a characteristic response to rising complexity: the temptation to reduce multidimensional evaluations of institutions and policies to a single economic metric. The rise of the neoclassical competition policy paradigm and the trajectory of late twentieth‑century antitrust exemplify this move, as analyses became progressively confined to a narrow focus on economic efficiency and price‑based indicators.
These insights challenge competition law’s reliance on static neoclassical models of perfect competition and monopoly, as well as its tendency to anchor economic evaluation to a single benchmark. An alternative, complexity‑aware approach would prioritize continuous adaptation, treating effective antitrust enforcement as a matter of maintaining market contestability, diversity, and dynamism by assessing innovation cycles, entry and exit, and diversification of business models rather than by merely monitoring static price‑output effects. In that regard, “effective competition” requires calibrating markets to generate, diffuse, and recombine diverse innovations and knowledge, instead of simply protecting consumer welfare at a given moment.
Innerarity’s framework supports methodological pluralism, combining narrative and mathematical analysis to capture the full spectrum of market and societal dynamics that shape democratic life. Reintroducing moral reasoning, ethics and political science into competition law restores the discipline’s original ambition: to protect markets as public domains that sustain industrial liberty and economic democracy, rather than treating them as purely technical devices for securing allocative efficiency.
Seen in this light, the model of complex democracy invites competition law to awaken from its technocratic slumber and confront the challenges of the 21st-century. This transformation begins with recognizing “competition policy as a compass to reach the kind of Europe we want to live in” and not merely as a toolbox for correcting market failures. Historically, competition law has emerged and evolved in response to waves of technological innovation and economic transformation. Today, democracies face another turning point, with potentially even greater consequences. Institutions tasked with safeguarding “effective competition” must therefore be equipped with flexible frameworks and technical tools capable of tracking and responding to evolving and composite anticompetitive practices by dominant market actors in complex digital ecosystems and they must not shy away from interpretive struggles aimed at the recalibration of competition law. In part II, we explore how competition analysis can integrate concerns about protecting democracy.
The text is based on Stavros Makris, Filip Lubinski, “Antitrust and complex democracy: Reclaiming markets from technofeudalism,” July 2025, Concurrences N° 7-2025, Art. N° 126683.
Authors’ Note: The authors would like to thank Afroditi Karatagli for her excellent research assistance and helpful comments on this essay.
Authors’ Disclosures: The authors report no conflicts of interest. You can read our disclosure policy here.
Articles represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.
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