IDEAS home Printed from https://ideas.repec.org/p/cor/louvrp/2810.html
   My bibliography  Save this paper

Monopoly price discrimination and privacy: the hidden cost of hiding

Author

Listed:
  • Paul BELLEFLAMME
  • Wouter VERGOTE

Abstract

A monopolist can use a ‘tracking’ technology to identify a consumer’s willingness to pay with some probability. Consumers can counteract tracking by acquiring a ‘hiding’ technology. We show that consumers may be collectively better off absent this hiding technology.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Paul BELLEFLAMME & Wouter VERGOTE, 2016. "Monopoly price discrimination and privacy: the hidden cost of hiding," LIDAM Reprints CORE 2810, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvrp:2810
    Note: In : Economics Letters, 149, 141-144, 2016
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Wolsey, L.A., 2015. "Uncapacitated Lot-Sizing with Stock Upper Bounds, Stock Fixed Costs, Stock Overloads and Backlogging: A Tight Formulation," LIDAM Discussion Papers CORE 2015041, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Rodrigo Montes & Wilfried Sand-Zantman & Tommaso Valletti, 2019. "The Value of Personal Information in Online Markets with Endogenous Privacy," Management Science, INFORMS, vol. 65(3), pages 1342-1362, March.
    3. Dirk Bergemann & Alessandro Bonatti, 2015. "Selling Cookies," American Economic Journal: Microeconomics, American Economic Association, vol. 7(3), pages 259-294, August.
    4. Fujita,Masahisa & Thisse,Jacques-François, 2013. "Economics of Agglomeration," Cambridge Books, Cambridge University Press, number 9781107001411.
    5. Hark‐Chin Hwang & Wilco van den Heuvel, 2012. "Improved algorithms for a lot‐sizing problem with inventory bounds and backlogging," Naval Research Logistics (NRL), John Wiley & Sons, vol. 59(3‐4), pages 244-253, April.
    6. Rodrigo Montes & Wilfried Sand-Zantman & Tommaso Valletti, 2015. "The Value of Personal Information in Markets with Endogenous Privacy," CEIS Research Paper 352, Tor Vergata University, CEIS, revised 05 Aug 2015.
    7. Lam, W., 2015. "Competiton in the Market for Flexible Resources: an application to cloud computing," LIDAM Discussion Papers CORE 2015034, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    8. Taylor, Curtis & Wagman, Liad, 2014. "Consumer privacy in oligopolistic markets: Winners, losers, and welfare," International Journal of Industrial Organization, Elsevier, vol. 34(C), pages 80-84.
    9. Nicky J. Welton & Howard H. Z. Thom, 2015. "Value of Information," Medical Decision Making, , vol. 35(5), pages 564-566, July.
    10. van den Heuvel, W. & Wagelmans, A.P.M., 2007. "Four equivalent lot-sizing models," Econometric Institute Research Papers EI 2007-30, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    11. Alessandro Acquisti & Curtis Taylor & Liad Wagman, 2016. "The Economics of Privacy," Journal of Economic Literature, American Economic Association, vol. 54(2), pages 442-492, June.
    12. Demuynck, Thomas & Rock, Bram De & Ginsburgh, Victor, 2016. "The transfer paradox in welfare space," Journal of Mathematical Economics, Elsevier, vol. 62(C), pages 1-4.
    13. Hindriks, Jean & Myles, Gareth D., 2013. "Intermediate Public Economics," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262018691, December.
    14. Nesterov, Y & Shikhman, V., 2015. "Computation of Fisher-Gale equilibrium by auction," LIDAM Discussion Papers CORE 2015035, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    15. Justin P. Johnson, 2013. "Targeted advertising and advertising avoidance," RAND Journal of Economics, RAND Corporation, vol. 44(1), pages 128-144, March.
    16. Stephen F. Love, 1973. "Bounded Production and Inventory Models with Piecewise Concave Costs," Management Science, INFORMS, vol. 20(3), pages 313-318, November.
    17. P. Belleflamme & D. Paolini, 2015. "Strategic Promotion and Release Decisions for Cultural Goods," Working Paper CRENoS 201508, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    18. Rodrigo Montes & Wilfried Sand-Zantman & Tommaso Valletti, 2015. "The Value of Personal Information in Markets with Endogenous Privacy," CEIS Research Paper 352, Tor Vergata University, CEIS, revised 05 Aug 2015.
    19. Vincent Conitzer & Curtis R. Taylor & Liad Wagman, 2012. "Hide and Seek: Costly Consumer Privacy in a Market with Repeat Purchases," Marketing Science, INFORMS, vol. 31(2), pages 277-292, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wolsey, L.A., 2015. "Uncapacitated Lot-Sizing with Stock Upper Bounds, Stock Fixed Costs, Stock Overloads and Backlogging: A Tight Formulation," LIDAM Discussion Papers CORE 2015041, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Anna D’Annunzio & Antonio Russo, 2020. "Ad Networks and Consumer Tracking," Management Science, INFORMS, vol. 66(11), pages 5040-5058, November.
    3. Choi, Jay Pil & Jeon, Doh-Shin & Kim, Byung-Cheol, 2019. "Privacy and personal data collection with information externalities," Journal of Public Economics, Elsevier, vol. 173(C), pages 113-124.
    4. Morlok, Tina & Matt, Christian & Hess, Thomas, 2017. "Privatheitsforschung in den Wirtschaftswissenschaften: Entwicklung, Stand und Perspektiven," Working Papers 1/2017, University of Munich, Munich School of Management, Institute for Information Systems and New Media.
    5. Simon Anderson & Alicia Baik & Nathan Larson, 2023. "Price Discrimination in the Information Age: Prices, Poaching, and Privacy with Personalized Targeted Discounts," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(5), pages 2085-2115.
    6. Chen, Yongmin & Hua, Xinyu & Maskus, Keith E., 2021. "International protection of consumer data," Journal of International Economics, Elsevier, vol. 132(C).
    7. Marta Rocha & Thomas Greve, 2021. "Contracting in a Market with Differential Information," Journal of Industry, Competition and Trade, Springer, vol. 21(2), pages 193-210, June.
    8. Flavio Pino, 2022. "The microeconomics of data – a survey," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 49(3), pages 635-665, September.
    9. Loertscher, Simon & Marx, Leslie M., 2020. "Digital monopolies: Privacy protection or price regulation?," International Journal of Industrial Organization, Elsevier, vol. 71(C).
    10. Chiara Conti & Pierfrancesco Reverberi, 2019. "Price discrimination and product quality under opt-in privacy regulation," DIAG Technical Reports 2019-07, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    11. Decerf, B., 2015. "A new index combining the absolute and relative aspects of income poverty: Theory and application," LIDAM Discussion Papers CORE 2015050, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    12. Jin, Ginger Zhe & Wagman, Liad, 2021. "Big data at the crossroads of antitrust and consumer protection," Information Economics and Policy, Elsevier, vol. 54(C).
    13. Queyranne, M. & Wolsey, L.A., 2015. "Modeling poset convex subsets," LIDAM Discussion Papers CORE 2015049, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    14. Masuyama, Ryo, 2023. "Endogenous privacy and heterogeneous price sensitivity," MPRA Paper 117316, University Library of Munich, Germany.
    15. Paul Belleflamme & Wing Man Wynne Lam & Wouter Vergote, 2017. "Price Discrimination and Dispersion under Asymmetric Profiling of Consumers," Working Papers halshs-01502452, HAL.
    16. Conti, Chiara & Reverberi, Pierfrancesco, 2021. "Price discrimination and product quality under opt-in privacy regulation," Information Economics and Policy, Elsevier, vol. 55(C).
    17. Stefano Colombo & Clara Graziano & Aldo Pignataro, 2023. "Personalized Pricing with Imperfect Customer Recognition," CESifo Working Paper Series 10455, CESifo.
    18. Dengler, Sebastian & Prüfer, Jens, 2021. "Consumers' privacy choices in the era of big data," Games and Economic Behavior, Elsevier, vol. 130(C), pages 499-520.
    19. Lagerlöf, Johan N.M., 2023. "Surfing incognito: Welfare effects of anonymous shopping," International Journal of Industrial Organization, Elsevier, vol. 87(C).
    20. Didier Laussel & Ngo Van Long & Joana Resende, 2023. "Profit Effects of Consumers’ Identity Management: A Dynamic Model," Management Science, INFORMS, vol. 69(6), pages 3602-3615, June.

    More about this item

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection
    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cor:louvrp:2810. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Alain GILLIS (email available below). General contact details of provider: https://edirc.repec.org/data/coreebe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.