Information Asymmetry and Thwarting Spam

11 Pages Posted: 20 Jan 2004  

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

Date Written: January 14, 2004

Abstract

We explore an alternative approach to spam based on economic rather than technological or regulatory screening mechanisms. We employ a model of email value which supports two intuitive notions: 1) mechanisms designed to promote valuable communication can often outperform those designed merely to block wasteful communication, and 2) designers of such mechansisms should shift focus away from the information in the message to the information known to the sender. We then use principles of information asymmetry to cause people who knowingly misuse communication to incur higher costs than those who do not. In certain cases, though not all, we can show this approach leaves recipients better off than even an idealized or ``perfect'' filter that costs nothing and makes no mistakes. Our mechanism also accounts for individual differences in opportunity costs, and allows for bi-directional wealth transfers while facilitating both sender signaling and recipient screening.

Keywords: Spam, email, information markets, mechanism design, signaling, screening, warranty, filtering, information asymmetry

JEL Classification: D82, M30, H21, C88, A10, K20, O33

Suggested Citation

Loder, Thede C. and Van Alstyne, Marshall W. and Wash, Rick, Information Asymmetry and Thwarting Spam (January 14, 2004). Available at SSRN: https://ssrn.com/abstract=488444 or http://dx.doi.org/10.2139/ssrn.488444

Thede C. Loder

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 (Contact Author)

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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