Too Much Data: Prices and Inefficiencies in Data Markets

@article{Acemoglu2019TooMD,
  title={Too Much Data: Prices and Inefficiencies in Data Markets},
  author={Daron Acemoglu and Ali Makhdoumi and Azarakhsh Malekian and Asuman E. Ozdaglar},
  journal={CEPR Discussion Paper Series},
  year={2019}
}
When a user shares her data with an online platform, she typically reveals relevant information about other users. We model a data market in the presence of this type of externality in a setup where one or multiple platforms estimate a user’s type with data they acquire from all users and (some) users value their privacy. We demonstrate that the data externalities depress the price of data because once a user’s information is leaked by others, she has less reason to protect her data and privacy… Expand
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