Mitigating the Tragedy of the Digital Commons: The Problem of Unsolicited Commercial E-Mail

Abstract:     
The growth of unsolicited commercial e-mail (UCE) imposes increasing costs on organizations and causes considerable aggravation on the part of e-mail recipients. A thriving anti-spam industry addresses some of the frustration. Regulation and various economic and technical means are in the works. All anti-spam measures aim at bringing down the flood of unwanted commercial e-mail. This paper contributes to the understanding of the UCE phenomenon by drawing on scholarly work in areas of marketing and resource ownership and use. Adapting the tragedy of the commons concept to e-mail, we identify a causal structure that drives the direct e-marketing industry. Computer simulations indicate that although filtering may be an effective method to curb UCE arriving at individual inboxes, it is likely to increase the aggregate volume, thereby boosting overall costs. We also examine other response mechanisms, including self-regulation, government regulation, and market mechanisms. We find that, of the various countermeasures, filtering appears to be the best currently available but that none are a satisfactory solution. The analysis advances understanding of the digital commons, the economics of UCE, and provides practical implications for the direct e-marketing industry.

Keywords: Unwanted commercial email (UCE), SPAM, email marketing, markets for attention, information overload, tragedy of the commons, system dynamics, simulation

JEL Classifications: D62, H41, K23, L86, L96, Q22

Accepted Paper Series