Market for Information and Selling Mechanisms

Arbeitspapier

We investigate the strategies of a data intermediary selling consumer information to firms for price discrimination purpose. We analyze how the mechanism through which the data intermediary sells information influences how much consumer information she will collect and sell to firms, and how it impacts consumer surplus. We consider three selling mechanisms tailored to sell consumer information: take it or leave it, sequential bargaining, and auctions. We show that the more information the intermediary collects, the lower consumer surplus. Consumer information collection is minimized, and consumer surplus maximized under the take it or leave it mechanism, which is the least profitable mechanism for the intermediary. We discuss two regulatory tools – a data minimization principle and a price cap – that can be used by data protection agencies and competition authorities to limit consumer information collection, increase consumer surplus, and ensure a fair access to information to firms.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 8307

Classification and Topics

• Classification: Wirtschaft
• Subject: market for information ; competition ; price discrimination ; data collection ; privacy ; selling mechanisms

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bounie, David ; Dubus, Antoine ; Waelbroeck, Patrick
• Event: Veröffentlichung
• (who): Center for Economic Studies and Ifo Institute (CESifo)
• (where): Munich
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/219125
• Last update: 10.03.2025, 11:44 AM CET