Drane consider a market where firms

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Companies Should Compete for Your Privacy by Dina Gerdeman Consumers are sometimes willing to trade personal data for lower prices. How should companies compete for that valuable information A discussion Chinese Overseas America Number Data with Ramon Casadesus Masanell and Andrés Hervás Drane. Consumers are increasingly wary about sharing personal information with firms. Yet when they benefit from providing information in exchange for lower prices or better services many consumers will gladly make the privacy trade off. But how does this disclosure of personal information affect competition among firms In the working paper Competing with Privacy Ramon.





Casadesus Masanell and Andrés Hervás set prices and disclosure levels for consumer information and consumers observe both before deciding which firm to patronize and how much personal information to provide. “FOCUSING ON A SINGLE REVENUE SOURCE IS THE MOST PROFITABLE STRATEGY WHEN FIRMS COMPETE FOR CONSUMER INFORMATION” It s clear from their research that the marketplace has plenty of room for two types of Internet firms those that ask consumers to disclose a large variety of personal data—in some cases in exchange for free services or lower prices—as well as firms that pledge to keep a lid on people s information but often charge consumers higher prices.