Privacy Regulation and Quality‐Enhancing Innovation
Yassine Lefouili,
Leonardo Madio and
Ying Lei Toh
Journal of Industrial Economics, 2024, vol. 72, issue 2, 662-684
Abstract:
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.
Date: 2024
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https://doi.org/10.1111/joie.12374
Related works:
Working Paper: Privacy regulation and quality-enhancing innovation (2024)
Working Paper: Privacy Regulation and Quality-Enhancing Innovation (2023)
Working Paper: Privacy Regulation and Quality-Enhancing Innovation (2023)
Working Paper: Privacy Regulation and Quality-Enhancing Innovation (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jindec:v:72:y:2024:i:2:p:662-684
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