Data ownership, data collection and personalized pricing

WANG Taiming, LI Sanxi, LIU Xiaolu

Systems Engineering - Theory & Practice ›› 2024, Vol. 44 ›› Issue (1) : 1-14.

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Systems Engineering - Theory & Practice ›› 2024, Vol. 44 ›› Issue (1) : 1-14. DOI: 10.12011/SETP2023-1773

Data ownership, data collection and personalized pricing

  • WANG Taiming1, LI Sanxi1,2, LIU Xiaolu1,3
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Abstract

Data ownership can either be considered as an indivisible monistic right or separated into ownership and usufruct, but the economic significance of data ownership and usufruct separation remains controversial. Digital enterprises' data-based services incentivize users to provide data, but also result in loss of privacy for users through personalized pricing. This paper constructs a monopoly firm model to explore the impact of data collection behavior and welfare under the definition of lack of usufruct and possession of usufruct when there is personalized pricing and privacy loss. The study finds that without usufruct, data collection will not occur if the privacy cost is high, but excessive data collection will occur if the privacy cost is low. When the collector has the initial usufruct and the user has ownership of the data, efficient data collection can be achieved, improving user surplus and social welfare. Data ownership only affects the distribution of social welfare between the collector and user. Therefore, we should consider the right definition framework of data ownership and usufruct separation and discuss the ownership of data usufruct in different scenarios. When the privacy cost is low, data collectors should be granted usufruct, and users should be allowed to exercise ownership through the "deletion right" and other ways to improve social welfare and user surplus. When the cost of privacy is high or users underestimate the cost of privacy, the method of prohibiting data collection should be adopted to protect sensitive data, rather than confirming rights.

Key words

data ownership / data collection / personalized pricing / privacy cost

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WANG Taiming , LI Sanxi , LIU Xiaolu. Data ownership, data collection and personalized pricing. Systems Engineering - Theory & Practice, 2024, 44(1): 1-14 https://doi.org/10.12011/SETP2023-1773

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Funding

National Natural Science Foundation of China (72192801, 72192802); the Key Project of Beijing Natural Science Foundation (Z220001); Youth Project of Humanities and Social Sciences Fundation of the Ministry of Education of China (20YJC790052); "Special Fund for Building World-class Universities (Discipline) and Guiding the Development of Characteristics of Central Universities" of Renmin University of China in 2023
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