A Theory of the Effects of Privacy

• 成果类型: Article; Early Access
• 署名作者: Bonatti, Alessandro; Huang, Yunhao; Villas-Boas, J. Miguel
• 署名单位: Massachusetts Institute of Technology (MIT); University of Southern California; University of California System; University of California Berkeley
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2024.05354
• 发表日期: 2025
• 关键词: privacy; INFORMATION; price discrimination; targeted advertising

摘要

The growth of information technologies has intensified concerns about individual privacy and highlighted the importance of consumer privacy rights. At the same time, these technologies enable significant personalization of communications and offerings. We develop a theory of the effects of privacy based on the concavity of an individual's derived payoff function with respect to market beliefs: When this function is concave, privacy is valuable. We identify market conditions that lead to concavity or convexity in the derived payoff function. The framework is applied to contexts such as product choice, price discrimination, data breaches, and health insurance.