Law Commons^™

Digital Market Manipulation, Ryan Calo

Articles

In 1999, Jon Hanson and Douglas Kysar coined the term “market manipulation” to describe how companies exploit the cognitive limitations of consumers. For example, everything costs $9.99 because consumers see the price as closer to $9 than $10. Although widely cited by academics, the concept of market manipulation has had only a modest impact on consumer protection law.

This Article demonstrates that the concept of market manipulation is descriptively and theoretically incomplete, and updates the framework of the theory to account for the realities of a marketplace that is mediated by technology. Today’s companies fastidiously study consumers and, increasingly, personalize …