Document de travail

Privacy Regulation and Quality-Enhancing Innovation

Yassine Lefouili, Leonardo Madio et Ying Lei Toh

Résumé

We analyze how a privacy regulation taking the form of a cap on information disclosure affects quality-enhancing innovation incentives by a monopolist--who derives revenues solely from disclosing user data to third parties--and consumer surplus. If the share of privacy-concerned users is sufficiently small, privacy regulation has a negative effect on innovation and may harm users. However, if the share of privacy-concerned users is sufficiently large, privacy regulation has a positive effect on innovation. In this case, there is no trade-off between privacy and innovation and users always benefit from privacy regulation.

Mots-clés

Privacy Regulation, Data Disclosure, Innovation;

Codes JEL

  • D83: Search • Learning • Information and Knowledge • Communication • Belief
  • L15: Information and Product Quality • Standardization and Compatibility
  • L51: Economics of Regulation

Remplacé par

Yassine Lefouili, Leonardo Madio et Ying Lei Toh, « Privacy Regulation and Quality-Enhancing Innovation », The Journal of Industrial Economics, 2023, à paraître.

Référence

Yassine Lefouili, Leonardo Madio et Ying Lei Toh, « Privacy Regulation and Quality-Enhancing Innovation », TSE Working Paper, n° 17-795, avril 2017, révision juillet 2023.

Voir aussi

Publié dans

TSE Working Paper, n° 17-795, avril 2017, révision juillet 2023