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The Market for Data Privacy

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  • Walther, Ansgar
  • Uettwiller, Antoine

Abstract

We scrape a comprehensive set of US firms' privacy policies to facilitate research on the supply of data privacy. We analyze these data with the help of expert legal evaluations, and also acquire data on firms' web tracking activities. We find considerable and systematic variation in privacy policies along multiple dimensions including ease of access, length, readability, and quality, both within and between industries. Motivated by a simple theory of big data acquisition and usage, we analyze the relationship between firm size, knowledge capital intensity, and privacy supply. We find that large firms with intermediate data intensity have longer, legally watertight policies, but are more likely to share user data with third parties.

Suggested Citation

  • Walther, Ansgar & Uettwiller, Antoine, 2019. "The Market for Data Privacy," CEPR Discussion Papers 13588, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:13588
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    References listed on IDEAS

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    Cited by:

    1. Yosuke Uno & Akira Sonoda & Masaki Bessho, 2021. "The Economics of Privacy: A Primer Especially for Policymakers," Bank of Japan Working Paper Series 21-E-11, Bank of Japan.
    2. Sabatino, Lorien & Sapi, Geza, 2022. "Online privacy and market structure: Theory and evidence," Information Economics and Policy, Elsevier, vol. 60(C).
    3. Patel, Pankaj C. & Oghazi, Pejvak & Arunachalam, S., 2023. "Does consumer privacy act influence firm performance in the retail industry? Evidence from a US state-level law change," Journal of Business Research, Elsevier, vol. 162(C).

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    More about this item

    Keywords

    Privacy; Data markets; Web tracking; Third-party sharing;
    All these keywords.

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • K2 - Law and Economics - - Regulation and Business Law
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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