Consumer Privacy in Oligopolistic Markets: Winners, Losers, and Welfare

17 Pages Posted: 23 Mar 2015  

Curtis R. Taylor

Duke University - Department of Economics

Liad Wagman

Illinois Institute of Technology - Stuart School of Business, IIT

Date Written: March 22, 2015

Abstract

Motivated by the unprecedented availability of consumer information on the Internet, we characterize the winners and losers from potential privacy regulation in the context of four commonly-used oligopoly models: a linear city model, a circular city model, a vertical differentiation model, and a multi-unit symmetric demand model. We show that while there are winners and losers as a result of privacy enforcement, the parties who stand to benefit and the parties who stand to lose, as well as whether social welfare is enhanced or diminished, largely depends on the specific economic setting under consideration.

Keywords: Privacy, Competition, Oligopoly, Consumer Information

JEL Classification: L13, D8, L5, L15, D43

Suggested Citation

Taylor, Curtis R. and Wagman, Liad, Consumer Privacy in Oligopolistic Markets: Winners, Losers, and Welfare (March 22, 2015). Available at SSRN: https://ssrn.com/abstract=2583453 or http://dx.doi.org/10.2139/ssrn.2583453

Curtis R. Taylor

Duke University - Department of Economics ( email )

213 Social Sciences Building
Box 90097
Durham, NC 27708-0204
United States
919-660-1827 (Phone)
919-684-8974 (Fax)

Liad Wagman (Contact Author)

Illinois Institute of Technology - Stuart School of Business, IIT ( email )

565 W Adams St Suite 452
Chicago, IL 60661
United States
7739809883 (Phone)

HOME PAGE: http://lwagman.org

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