The Impact of Privacy Regulation on Web Traffic: Evidence From the GDPR

Raffaele Congiu, Lorien Sabatino and Geza Sapi

Information Economics and Policy, 2022, vol. 61, issue C

Abstract: We use traffic data from around 5,000 web domains in Europe and United States to investigate the effect of the European Unions General Data Protection Regulation (GDPR) on website visits and user engagement. We document an overall traffic reduction of approximately 15% in the long-run and find a measurable reduction in engagement with websites. Traffic from both paid and unpaid channels dropped significantly. We observe an inverted U-shaped relationship between website size and change in visits due to privacy regulation: the smallest and largest websites lost visitors, while medium-sized ones were less affected. Enforcement matters as well: The effects were amplified considerably in the long-run, following the first significant fine issued eight months after the entry into force of the GDPR. Exploring potential mechanisms, both a reduction in advertising effectiveness and a higher user awareness of privacy issues can explain our results.

Keywords: Privacy regulation; GDPR; Web traffic; Marketing channels; Firm size (search for similar items in EconPapers)
JEL-codes: D43 D8 L13 L15 L5 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:iepoli:v:61:y:2022:i:c:s0167624522000427

DOI: 10.1016/j.infoecopol.2022.101003

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