Personal data on sale

Having reached an unprecedented degree of connectivity, we have become the target of countless organizations that aim to gain access to information about ourselves on many fronts, types, and circumstances of our lives. Like it or not, our personal communications devices are the source of data transmitted and shared with actors that find value in their using, processing, and even selling our data. Rendering personal data in exchange for free digital services, selling personal data at data marketplaces, and contributing personal data to national statistics organizations (i.e., a country’s census) are situations where our personal data are stored, processed and consumed by such actors. Digital platforms derive a significant fraction of their revenue from advertisers who are allowed to access, retrieve, and manipulate the data that users, knowingly or not, generate continuously. While on the user edge of the platform, such personal information is collected without compensation to the user, on the advertiser edge, a market for the sale of personal information soars. Some analysts [1] consider that a market failure arises on the user edge where platforms provide free internet search or social networking. Further, on data marketplaces where data are sold and bought, individuals can sell their personal information while given varying degrees of privacy protection and assurance of anonymity. Finally, national census organizations rely on truthful disclosure of information by individuals and families, who entrust their governments with their data for the greater benefit society will enjoy if, and when, data-driven policies and decisions are made.An underlying theme, and one whose importance has become increasingly visible, is people’s concern about how the privacy of their data is protected. This paper proposes an analytical framework to understand the drivers of data value on the three institutions listed above while examining mechanisms in place or proposed for protecting the identity of data owners. It reviews the literature on data pricing and privacy protection to understand how individuals value their personal data, as value becomes a support for data pricing decisions. We identify three pathways for personal data once the individual agrees to their release. Personal data may turn into a public good collected by a national census office; it can be sold at a data marketplace, or it can be “exchanged” for digital services at a digital platform. In all cases, we undertake an analysis of the trade-off between data value (or price where it applies) and privacy loss, identifying metrics that quantify it. Literature provides instances of this issue: [2] views the statistical reports coming from the census data as the product of deciding the optimal levels of two inputs, namely, statistical accuracy and privacy loss; a model is discussed to maximize the social value is of reporting accurately while protecting individuals’ privacy; [3] discusses legal approaches to monetize an individual’s behavioural surplus, that is, an individual’s data stored on a social network account. We contribute the preliminary results of lab experimentation with subjects who participate in reverse auctions aimed at purchasing their personal data with and without assurance of privacy protection.