The interplay of consumer privacy, competition, and regulation

Olga Kozlova Guglielmi, Philipp Tillmann and Catherine Tucker

Chapter 2 in Research Handbook on Data, Privacy and Competition Law, 2025, pp 35-57 from Edward Elgar Publishing

Abstract: Abstract. With the rapid decrease in the cost of collecting, storing, and processing big data, government authorities have in recent years paid increasing attention to the way companies collect data online and how consumer privacy interacts with competition. In this chapter, we provide an overview of the economics of consumer privacy and competition and summarize literature on the interplay of attempts to regulate consumer privacy and competition. The literature shows that the role that consumer privacy plays as a dimension of firm competition is nuanced and context-specific. For this reason, attempts to regulate consumer privacy require careful consideration of the industry-specific impact and potentially unintended consequences on both consumer privacy as well as competition. From an economics perspective, regulation can be viewed as a cost imposed on firms that disproportionately affects smaller firms and entrants and can therefore affect competition. Consistent with this view, the empirical literature finds in different industry settings that consumer privacy regulation can have unintended consequences on competitive outcomes.

Keywords: Consumer privacy; Competition; Regulation; Privacy paradox (search for similar items in EconPapers)
Date: 2025
ISBN: 9781802202328
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