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The Welfare Effects of Ad-Blocking

Author

Listed:
  • Fengyang Lin

    (Cornell Bowers CIS, Cornell University, Ithaca, NY 14853)

  • Cristobal Cheyre

    (Cornell Bowers CIS, Cornell University, Gates Hall 210, Ithaca, NY 14853)

  • Alessandro Acquisti

    (Heinz College, Carnegie Mellon University, 5000 Forbes Ave, HBH 2105C, Pittsburgh, PA 15213)

Abstract

Concerns regarding online tracking and excessive advertising have led to a marked increase in the adoption of Ad-Blocking tools. We conduct a field experiment to study users’ valuation of Ad-Blockers, and to study how exposing or shielding users from online advertising influences their online experiences, their attitudes towards online advertising, their valuation of ad-blocking tools, and their future usage of such tools. We find that for users currently using an ad-blocker, uninstalling them leads to a deterioration in their online experiences and lower satisfaction with recent purchases. For users that were not using Ad-Blockers, installing one led to fewer reported regrets with purchases, an improvement in subjective well-being, and a less positive view of online advertising. In terms of users’ valuation of Ad-Blockers, we observe a great degree of heterogeneity. Some users are not willing to uninstall their Ad-Blocker even if offered large payments (>$100). Conversely, a similar number of users are not willing to install an Ad-Blocker even if offered large payments. However, most users are willing to install/uninstall an Ad-Blocker in exchange for moderate payments (

Suggested Citation

  • Fengyang Lin & Cristobal Cheyre & Alessandro Acquisti, 2023. "The Welfare Effects of Ad-Blocking," Working Papers 23-05, NET Institute.
    • Handle: RePEc:net:wpaper:2305
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    File URL: http://www.netinst.org/Cheyre_23-05.pdf
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    More about this item

    Keywords

    Online Advertising; Ad-Blockers;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • M37 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Advertising

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