In How Consumers Value Digital Privacy: New Survey Evidence, Program on Economics & Privacy affiliated scholar, Professor Caleb Fuller presents new data that sheds light on the “Privacy Paradox.”
Regardless of how they define it, few people would deny that they’d like more privacy. The rise of the data-driven economy has thrust privacy issues to the fore of the public consciousness and it is unsurprising that the average American citizen, when surveyed, expresses a desire for less privacy-invasive behavior by both private firms and by government. But are they willing to bear the costs associated with additional privacy protection? The case for government intervention in digital markets is made stronger if consumers value privacy highly and if they are highly uninformed.
Based on a random sample of Internet users, Professor Fuller finds:
- 71% of Google users would prefer the same experience without tracking. For these users, privacy is an economic good of which they would prefer more, ceteris paribus.
- Only 15% of Google users would be willing to pay anything to avoid tracking, suggesting that at least for this group the ceteris paribus assumption is key.
- Of this group, the average annual willingness to pay to avoid tracking was $77, substantially lower than the $850 the average American spends on soft drinks each year.
- Among all Google users, 90% respond that they are aware of Google’s information collection, suggesting that, at least with respect to Google, ignorance regarding the practice of information collection is not widespread.
These findings lead Professor Fuller to conclude that “the ‘privacy paradox’ may not be a result of biases causing consumers to act inconsistently with their true preferences. Rather, it’s possible that the paradox may be explained on simpler grounds: surveys often take an unconstrained approach; behavior online always incurs a real cost (even if it’s a very small opportunity cost).”
Professor Fuller will be presenting his paper, Is the Market for Digital Privacy a Failure?, which draws on this new evidence, at the FTC’s PrivacyCon on February 28.
Read the full report here.
George Mason University Antonin Scalia Law School
Program on Economics & Privacy
Third Annual Digital Information Policy Scholars Conference
April 27, 2018
Antonin Scalia Law School at George Mason University, Arlington, VA
The Program on Economics & Privacy (PEP) at Antonin Scalia Law School will host a scholars conference on the economics of digital information policy on April 27, 2018. The conference will be open to the public.
The mission of PEP is to promote the sound application of economic analysis to issues surrounding the digital information economy through original research, policy outreach, and education. The annual Digital Information Policy Scholars Conference is intended to further this goal by providing a forum to present original research on this important area of the US economy.
Topics of interest include, but are not limited to:
- Consumer valuation of privacy
- Markets for privacy
- The impact of state and federal privacy & data security regulation on consumers and firms
- The GDPR and other European privacy regulations
- Private litigation under state and federal privacy and data security laws
- Liability issues surrounding the Internet of Things
- The use of big data for consumers scoring
- The intersection of privacy and competition policy
- Competition policy and Internet platforms
- Student privacy
- Consumer responses to disclosures
- Privacy and data security issues surrounding biometrics
Please send your paper or abstract by February 19, 2018, to Jeff T. Smith, Coordinator of PEP, at email@example.com. Preference will be given to completed papers. The selection committee includes Alessandro Acquisti (Carnegie Mellon), Jane Bambauer (University of Arizona, James E. Rogers College of Law), Michael Baye (Indiana University, Kelley School of Business), James Cooper (George Mason University Antonin Scalia Law School), Sasha Romanosky (RAND), Andrew Stivers (Federal Trade Commission), and Catherine Tucker (MIT, Sloan School of Management). Selections will be made by March 5, 2018.
Selected authors will receive a $300 honorarium and will be provided lodging for the night of April 26, 2018. There will be a dinner for participants on April 26. Selected authors will be responsible for submitting a final version of their paper by April 13, 2017. In addition to presenting their paper, selected authors will be expected to serve as a discussant for one paper at the conference.
The Program on Economics & Privacy (PEP) at George Mason University Antonin Scalia Law School invites applications for the 2017-18 Privacy Scholars Fellowship Program. The Privacy Scholars Fellowship Program is designed to support research on the economics of privacy and data security. Total honorarium payments of $12,000 per paper will be available to those who complete all stages of the program. The PEP will provide lodging and meals at all events, but participants will be responsible for their own transportation arrangements and expenses.
The Fellowship Program is structured in five stages that are designed to lead to the completion of an original piece of scholarly work suitable for publication.
- Submission of Research Proposal – Submission Deadline of October 13, 2017: Research proposals should include a statement of issue to be addressed, the proposed methodology, as well as a discussion of the feasibility for completion by Summer 2018. Proposals should be no longer than five pages (not including charts, graphs, or bibliography). The PEP will notify those chosen to present a more fully developed draft at the December roundtable by October 23, 2017. Those authors chosen to present will be provided an honorarium of $3,000 after attending the December roundtable. The selection committee includes: Alessandro Acquisti (Carnegie Mellon), Jane Bambauer (University of Arizona, James E. Rogers College of Law), Michael Baye (Indiana University, Kelley School of Business), James Cooper (George Mason University, Antonin Scalia Law School), Andrew Stivers (Federal Trade Commission), and Catherine Tucker (MIT, Sloan School of Management).
- Research Roundtable at Antonin Scalia Law School (December 14-15, 2017): Selected authors will present expanded drafts at a research roundtable to be held at Antonin Scalia Law School on December 14-15, 2017. Revised drafts should be no more than 25 pages (excluding charts, graphs, and bibliography), and represent substantial work beyond the proposal (e.g., preliminary statistical results). This research roundtable is a workshop designed to provide authors with constructive feedback from expert academics and practitioners in the field. The PEP will make final decisions on which research it will support with a Privacy Scholars Fellowship by December 18, 2017.
- First Draft (February 16, 2018): Each Fellowship recipient is required to submit a First Draft of his or her paper by February 16, 2018. These drafts should be substantially revised based on feedback from the December research roundtable, and should provide reviewers with a clear sense of the approach and direction of the paper. Each First Draft will be subjected to anonymous peer review designed to provide constructive feedback. Comments will be sent to Fellowship recipients in early March. Fellowship recipients will receive an honorarium of $3,000 for timely submission.
- Presentation of Second Draft at Digital Information Policy Scholars Conference at Antonin Scalia Law School (April 27, 2018): Privacy Fellows will submit a revised draft of their paper that responds to comments from peer reviewers for the Third Annual Digital Information Policy Scholars Conference, to be held on April 27, 2018 at Antonin Scalia Law School. Fellowship recipients will present revised drafts of their papers and serve as a discussant for one paper during the conference. Fellowship recipients successfully participating in the Scholars Conference will receive an honorarium of $3,000.
- Completion of Final Draft and Submission to an Academic Journal (Summer 2018): Following presentation at the Scholars Conference, Fellowship recipients are expected to revise their paper and to seek publication in a suitable academic journal. Upon completion of this requirement, Fellowship recipients will receive a final honorarium of $3,000.
Empirical projects are strongly preferred to theoretical or doctrinal research. Topics of special interest include the following:
- Consumer valuation of privacy
- Identifying and measuring privacy harms
- The impact of privacy and data security regulation on firms, consumers and market outcomes
- Assessing the likelihood and magnitude of harm from data breach
- Measuring the privacy benefits of the Internet
- Consumer responses to privacy disclosures
- The cost of complying with privacy and data security regulations, including the impact on information flows and product design
- The relationship between privacy and data security
- Issues surrounding biometric privacy laws
- The impact of state and federal privacy laws on the use of online learning in classroom
- Issues related to algorithmic decision-making, machine learning, and artificial intelligence
The PEP’s mission is to inject sound economic analysis into policy discussions surrounding privacy, data security, and other competition and consumer protection issues facing the digital economy. We pursue this mission through research, education, and hosting public policy programs that bring together academics, thought leaders, and government officials to discuss cutting edge issues involving the digital economy. For more information regarding this program or other initiatives of the PEP, please visit https://pep.gmu.edu.
You may also call or send an email to James Cooper, Associate Professor of Law and Director, Program on Economics & Privacy, at 703.993.9582 or firstname.lastname@example.org.
Program on Economics & Privacy affiliated faculty member, Professor Jane Bambauer, explores the recent developments in biometric privacy laws in her latest paper, “Biometric Privacy Laws: How a Little-Known Illinois Law Made Facebook Illegal.”
Banks and retailers are increasingly interested in using biometric information to authenticate customers by converting a scan of their biological features into an elaborate password.
The benefits of biometric authentication are obvious, but so are the drawbacks: since the systems use scans of irises, fingers, and even facial structures, a user’s biometric passwords are on public display every time they leave the house. Some states have passed biometric privacy laws to help facilitate the development of biometric authentication technologies. But these well-intentioned biometric privacy laws showcase the problems that arise when public policy tries to keep up with technology.
They are wildly overbroad, potentially exposing even individual users of basic photo organization software to civil liability based on conduct that poses no risk to data security. What is more, the laws are also unlikely to be necessary to accomplish their intended goals; companies that are developing biometric authentication systems to protect sensitive personal data are already using technological solutions to manage the security risks, rendering the legal solutions obsolete. Finally, their scope possibly contravenes the First Amendment and the Dormant Commerce Clause.
Although the purpose of these nascent laws is laudable, so far they appear to have only spurred class action litigation that is likely to harm, rather than help, the interests of the average consumer.
Read the full paper here.
Registration is still open for the 5th Annual Public Policy Symposium on the Law & Economics of Privacy and Data Security on Thursday, June 8, 2017 at George Mason University Antonin Scalia Law School.
The morning keynote will feature Omri Ben-Shahar (The University of Chicago); the luncheon will feature a keynote address from David A. Hyman (Georgetown Law), and a panel discussion on the The Future of FTC Privacy & Data Security Policy featuring Thomas B. Pahl, Acting Director of the FTC’s Bureau of Consumer Protection. Speakers at the Symposium also include Julie Brill, former FTC Commissioner and partner at Hogan Lovells, Joshua D. Wright, former FTC Commissioner and professor of law at Antonin Scalia Law School, William C. MacLeod, former Director of the FTC’s Bureau of Consumer Protection, and Chair of the ABA Antitrust Section, and Lydia Parnes, former Director of the FTC’s Bureau of Consumer Protection, and partner at Wilson Sonsini Goodrich & Rosati.
The Program on Economics & Privacy (PEP) and Mason Attorneys General Education Program are pleased to announce their upcoming Workshop for Attorneys General on the Economics of Information, Advertising, and Privacy, Wednesday, June 7, 2017 through Thursday, June 8, 2017. The Workshop will bring together state attorneys general staff and regulators from throughout the United States to discuss and hear from leading experts on the economics of information on the issues confronting policy makers in the digital economy.
The first day of the Workshop (June 7) will be devoted to in-depth instruction on the economics of information, advertising, and privacy. On June 8, attendees will take part in PEP’s 5th Annual Symposium on the Law & Economics of Privacy and Data Security. In partnership with the Future of Privacy Forum and the Journal of Law, Economics & Policy, this year’s symposium will explore the development of a benefit-cost framework for privacy and cybersecurity policy. Scholars from interdisciplinary backgrounds, including economics, law, public policy, business and marketing, will address topics such as: How to evaluate the success of data control programs; the proper role of ex ante regulation versus ex post enforcement; and the proper accounting of subjective privacy harms as well as the benefits from tailored content and advertising.
The Program on Economics & Privacy, in partnership with the Future of Privacy Forum, and the Journal of Law, Economics & Policy, will hold its 5th Annual Public Policy Conference on the Law & Economics of Privacy and Data Security, on Thursday, June 8, 2017 at George Mason University Antonin Scalia Law School in Arlington, VA.
Data flows are central to an increasingly large share of the economy. A wide array of products and business models—from the sharing economy and artificial intelligence to autonomous vehicles and embedded medical devices—rely on personal data. Consequently, privacy regulation leaves a large economic footprint. As with any regulatory enterprise, the key to sound data policy is striking a balance between competing interests and norms that leaves consumers better off; finding an approach that addresses privacy concerns, but also supports the benefits of technology is an increasingly complex challenge. Not only is technology continuously advancing, but individual attitudes, expectations, and participation vary greatly. New ideas and approaches to privacy must be identified and developed at the same pace and with the same focus as the technologies they address.
The morning keynote will feature Omri Ben-Shahar (The University of Chicago); the luncheon will feature a keynote address from David A. Hyman (Georgetown Law), and a panel discussion on the The Future of FTC Privacy & Data Security Policy featuring Thomas B. Pahl, Acting Director of the FTC’s Bureau of Competition. This conference will also feature speakers from the International Association of Privacy Professionals (IAPP), Center for Democracy & Technology (CDT), The George Washington University, Wilson Sonsini Goodrich & Rosati, and Kelley Drye & Warren LLP.
Click here to register.
Selected submissions will be presented at the Fifth Annual Public Policy Symposium on the Law & Economics of Privacy and Data Security Policy, on June 8, 2017, at the Antonin Scalia Law School, and published in a special symposium issue of the Journal of Law, Economics & Policy.
Click here for more information and to learn how to submit your paper.