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An Economic Response to Unsolicited Communication

43 Pages Posted: 30 Jul 2012  

Thede C. Loder

University of Michigan - Department of Electrical Engineering and Computer Science

Marshall W. Van Alstyne

Boston University – Questrom School of Business; Massachusetts Institute of Technology (MIT) - Sloan School

Rick Wash

University of Michigan at Ann Arbor - School of Information

Multiple version iconThere are 2 versions of this paper

Date Written: August 15, 2005

Abstract

We investigate welfare effects of mechanisms designed to improve total communications value. Identifying first contact information asymmetry and negative externalities as the critical problems, we analyze best-in-class solutions from law, technology, and economics. Comparison leads to several useful conclusions. First, mechanisms designed to promote valuable communication can outperform those designed to block wasteful communication. The best mechanism can, on occasion, outperform even a “perfect filter.” Second, it is advantageous to shift focus from message content to senders’ private knowledge. Recipients can then use information revelation mechanisms to force people who knowingly misuse communication to drop out or incur higher costs. Third, private knowledge of message value and the choice to communicate might favor senders over receivers. These advantages disappear, however, under a take-it-or-leave-it offer by recipients to refuse non-conforming communications. Fourth, giving recipients rights in their own attention can improve willingness to signal their preferences, which facilitates efficient sender targeting.

Suggested Citation

Loder, Thede C. and Van Alstyne, Marshall W. and Wash, Rick, An Economic Response to Unsolicited Communication (August 15, 2005). TPRC 2005. Available at SSRN: https://ssrn.com/abstract=2119659

Thede C. Loder (Contact Author)

University of Michigan - Department of Electrical Engineering and Computer Science ( email )

1101 Beal Avenue
Ann Arbor, MI 48109
United States
415-420-8615 (Phone)

HOME PAGE: http://www.loder.com

Marshall W. Van Alstyne

Boston University – Questrom School of Business ( email )

595 Commonwealth Avenue
Boston, MA 02215
United States
617-358-3571 (Phone)

HOME PAGE: http://questromapps.bu.edu/mgmt_new/Profiles/VanAlstyneMarshall.html

Massachusetts Institute of Technology (MIT) - Sloan School ( email )

Center for Digital Business
5 Cambridge Center - NE25, 7th Floor
Cambridge, MA 02142
United States
617-253-0768 (Phone)

HOME PAGE: http://web.mit.edu/marshall/www/home.html

Richard Wash

University of Michigan at Ann Arbor - School of Information ( email )

304 West Hall
550 East University
Ann Arbor, MI 48109-1092
United States

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