Online Privacy and Information Disclosure by Consumers

Ichihashi, Shota

doi:10.2139/ssrn.3112905

Cited by 10 publications

(6 citation statements)

References 37 publications

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“…Instead, in this section we derive an upper bound for consumer surplus across all symmetric signal structures which induce a symmetric (pure or mixed strategy) equilibrium, and show that this upper bound is close to the maximum consumer surplus available with pure rank signal structure with associated prices p 1 = p 2 = H allows the …rm to fully extract surplus regardless of whether ( 16) holds. See Ichihashi (2020) for a related observation.…”

Section: Allowing Mixed Pricing Strategiesmentioning

confidence: 91%

Mixed bundling in oligopoly markets

Zhou

2021

Journal of Economic Theory

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This paper studies competition between …rms when consumers observe a private signal of their preferences over products. Within the class of signal structures which induce pure-strategy pricing equilibria, we derive signal structures which are optimal for …rms and those which are optimal for consumers. The …rm-optimal policy ampli…es underlying product di¤erentiation, thereby relaxing competition, while ensuring consumers purchase their preferred product, thereby maximizing total welfare. The consumer-optimal policy dampens di¤erentiation, which inten-si…es competition, but induces some consumers to buy their less-preferred product. Our analysis sheds light on the limits to competition when the information possessed by consumers can be designed ‡exibly.

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Section: Allowing Mixed Pricing Strategiesmentioning

confidence: 91%

Mixed bundling in oligopoly markets

Zhou

2021

Journal of Economic Theory

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“…One could think, for example, about situations where information allows producers to help consumers make better choices (Ichihashi, 2019) or where data is used to construct credit ratings that could potentially improve the allocation of credit (Pagano and Jappelli, 1993).…”

Section: Policymentioning

confidence: 99%

Privacy as a Public Good: A Case for Electronic Cash

Garratt

Oordt

2021

Journal of Political Economy

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Privacy is a feature inherent to the use of cash for payments. With steadily increasing market shares of commercial digital payments platforms, privacy in payments may no longer be attainable in the future. In this paper, we explore the potential welfare impact of reductions in privacy in payments in a dynamic framework. In our framework, firms may use data collected through payments to price discriminate among future customers. A public good aspect of privacy in payments arises because individual customers do not bear the full cost of failing to protect their privacy. As a consequence, they may suboptimally choose not to preserve their privacy in payments. When left to market forces alone, the use of privacy-preserving means of payments, such as cash, may decline faster than is optimal. Bank topics: Digital currencies and fintech; Bank notes; Payment clearing and settlement systems; Central bank research JEL codes: E42, G28 "This [central bank digital] currency could satisfy public policy goals, such as (i) financial inclusion, (ii) security and consumer protection; and to provide what the private sector cannot: (iii) privacy in payments."

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“…12 Ichihashi (2020) shows that the seller has an incentive to commit to not price discriminate to encourage consumer information sharing, but this can harm consumers in equilibrium because the firm may set a higher uniform price anticipating better a match between consumers and products. Ali, Lewis, and Vasserman (2020) study a related problem but in a different setup with single-product firms and argue that sharing preference information with firms can benefit consumers by amplifying price competition.…”

Section: Related Literaturementioning

confidence: 99%

Open Banking: Credit Market Competition When Borrowers Own the Data

He¹,

Huang²,

Zhou³

2020

SSRN Journal

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Open banking facilitates data sharing consented by customers who generate the data, with a regulatory goal of promoting competition between traditional banks and challenger fintech entrants. We study lending market competition when sharing banks' customer data enables better borrower screening or targeting by fintech lenders. Open banking could make the entire financial industry better off yet leave all borrowers worse off, even if borrowers could choose whether to share their data. We highlight the importance of equilibrium credit quality inference from borrowers' endogenous sign-up decisions. When data sharing triggers privacy concerns by facilitating exploitative targeted loans, the equilibrium sign-up population can grow with the degree of privacy concerns.

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Online Privacy and Information Disclosure by Consumers

Cited by 10 publications

References 37 publications

Mixed bundling in oligopoly markets

Mixed bundling in oligopoly markets

Privacy as a Public Good: A Case for Electronic Cash

Open Banking: Credit Market Competition When Borrowers Own the Data

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