"I don't care about cookies!" Platform Data Disclosure and Time-Inconsistent Users

40 Pages Posted: 22 Mar 2021

See all articles by Laura Abrardi

Laura Abrardi

Politecnico di Torino

Carlo Cambini

Politecnico di Torino & EUI - Florence School of Regulation; European University Institute - Robert Schuman Centre for Advanced Studies (RSCAS)

Steffen Hoernig

Nova School of Business and Economics

Date Written: March 16, 2021

Abstract

Time-inconsistent internet users neglect future privacy costs and release too much data to be monetized by digital platforms. We study how regulations that require user consent for data processing affect platform profits, welfare and user surplus, depending on business models and the degree of time inconsistency. Consent mechanisms increase user surplus or welfare only if their design facilitates consent refusal. If platforms can make it difficult to opt out, it may be better for society as a whole if the former choose the disclosure level, even though it tends to be excessive from a user point of view. Voluntary caps on usage, as recently adopted by some platforms, can raise profits by making some users consent to more disclosure.

Keywords: Data, platforms, time inconsistency, privacy

JEL Classification: D82, D83, D86, L12, L51

Suggested Citation

Abrardi, Laura and Cambini, Carlo and Hoernig, Steffen, "I don't care about cookies!" Platform Data Disclosure and Time-Inconsistent Users (March 16, 2021). Available at SSRN: https://ssrn.com/abstract=3806112 or http://dx.doi.org/10.2139/ssrn.3806112

Laura Abrardi

Politecnico di Torino ( email )

Corso Duca degli Abruzzi, 24
Torino, Torino 10129
Italy

Carlo Cambini

Politecnico di Torino & EUI - Florence School of Regulation ( email )

Corso Duca degli Abruzzi, 24
Torino, Torino 10129
Italy
+390115647292 (Phone)
+390115647299 (Fax)

European University Institute - Robert Schuman Centre for Advanced Studies (RSCAS) ( email )

Villa La Fonte, via delle Fontanelle 18
50016 San Domenico di Fiesole
Florence, Florence 50014
Italy

Steffen Hoernig (Contact Author)

Nova School of Business and Economics ( email )

Campus De Carcavelos
Rua Da Holanda 1
Carcavelos, 2775-405
Portugal
+351-213801600 (Phone)

HOME PAGE: http://https://www2.novasbe.unl.pt/en/faculty-research/faculty/faculty-detail/id/46/steffen-hoernig

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