Daughety, Andrew F.; Reinganum, Jennifer F. - Vanderbilt University Department of Economics - 2008
We develop and explore a new model of the economics of privacy. Previous work has focused on "privacy of type," wherein … an agent privately knows an immutable characteristic. We consider "privacy of action," wherein privacy means that an … agent's choice of action is unobservable to others. To show how a policy of privacy can be socially optimal, we assume that …