Weighing the Value of Privacy

An anonymous reader writes "A new study from HP Labs shows that the reluctance of individuals to reveal private information (or how much money they would demand to do so), depends on how far they perceive themselves to be from the norm. For example, those who think they are overweight ask a higher price to step on a scale in front of their peers, than those of average weight. From the article: 'How and why people decide to transition their information from the private to the public sphere is poorly understood. To address this puzzle, we conducted a reverse second-price auction to identify the monetary value of private information to individuals and how that value is set. Our results demonstrate that deviance, whether perceived or actual, from the group's average asymmetrically impacts the price demanded to reveal private information.'"

Comments

Re:Second Bid Auction

[ignatz'brick]

Apparently it has, it's called a Vickrey auction.

I'm sure people would get it, after a few predictable and expensive disasters.

Re:Second Bid Auction

[HeghmoH]

Unless I'm grossly mistaken, this is exactly how it has always worked on eBay.

on privacy and its "price"

[tuxette]

It is natural for most people to consider certain bits of personal data more personal and private than others. This of course affects what kind of personal information a person is willing to give out, and for what price, as the "Privacy and Deviance" paper suggests.

I have researched privacy quite heavily, mostly privacy and IKT (especially Internet). I even wrote a thesis that touched on this kind of thing, at least in one of the chapters, part of which I will share with you below. Some of the most important aspects of privacy is that it tends to be dependent on context and environment, and based on own activities and needs. People are also willing to give up privacy for some kind of (financial) gain, usually in the form of discounts, prizes, etc. And "convenience" of course.

(From Chapter 2 - "Privacy in the Internet age")

In order to discuss privacy protection on the Internet, I must first determine what privacy means. Privacy is a hotly debated issue on a very broad concept. Privacy can be thought of as among other things:

• "the right to be left alone" (Warren and Brandeis, 1890) ? which contains elements such as "the right to expect confidentiality," "the right to enjoy private space" and "the right to individual autonomy" (Industry Canada, 2001),
• the notion that certain aspects of a person's nature and activities should not be revealed to anyone (Bellotti, 1997),
• taking the institutional approach, the institutionally organized ability of individuals to negotiate their relationships with others (Agre, 1999), or similarly "the claim of individuals, groups and institutions to determine for themselves, when, how and to what extent information about them is communicated to others" (Westin, 1967),
• interpreted in a contextual manner, activities that are allowed in the home may not be allowed in public (Bellotti, 1997),
• a fundamental (though not absolute) human right recognized in the UN Declaration of Human Rights, the International Covenant on Civil and Political Rights and the European Convention for the Protection of Human Rights and Fundamental Freedoms.

The above shows that the concept of privacy is non-singular, and that definitions vary widely according to context and environment. Privacy interests have several dimensions including privacy of the person or personality, privacy of personal behavior and personal associations, privacy of personal communications, and privacy of personal data (Clarke, 1999(a)). A common consensus, however, is that privacy is something every human needs at some level and in some degree (Bennett, 2001). Privacy protection is "a process of finding appropriate balances between privacy and multiple competing interests" (Clarke, 1999(a)). This balancing process is political in nature, involving the exercise of power deriving from authority, markets or any other available source (Clarke, 1998(b)).

Cynically, since privacy is such a vague and "stretchy" concept, people often apply it for their own purposes (Schartum, 2001(b)). One of the cynical attitudes is that privacy is only useful for creating "a level playing field," as in the case of privacy conflicts with business interests that see personal data as a resource (Bennett, 1996). The way individuals actually view privacy tends to be dependent on their own personal activities and needs - why do I need (or not need) privacy, and to what degree? Furthermore, while identity is a public and symbolic phenomenon, historical, cultural, and social structure factors also play a role in how far an individual goes in giving out whom he or she is (Agre, 1999). A common argument is "I have nothing to hide," yet Bacard (2000) points out "show me a human being who has no secrets from her family, her neighbors, or her colleagues, and I'll show you someone who is either an extraordinary exhibitionist or an incredible dullard. Show me a business that has no trade secrets or confidential records, and I'll show you a business that is not very successful."

Re:Second Bid Auction

[jareds]

This is almost exactly how it works on eBay. The person with the highest bid wins the item for a price a small increment higher than the second highest bid. The difference is trifling.

Re:Second Bid Auction

[Moridin42]

Actually.. all forms of auction will tend towards the same price for the same item.

In the case of second bid auctions (relative to first bid) you are more likely to bid higher, because you know you don't have to pay what you bid. If you win, you pay what the next guy bid. But.. you also know that other people react the same way. So, where as you might've been willing to bid $100 for something under a first bid system, you may goto $110 under second bid. But in second place might've stopped at 90, and would be willing to go up to 100 under second bid, and you end up paying $100 anyway. And you can take this out to any number of places. Say, you pay what the third highest person bid, and the same sort of situation would arise. There's even an auction type where the high bid takes the item for free and all the losing bids pay their bid. Its called the "Glum Losers" auction style. Here you've got two countervailing incentives. One, high bid means you pay nothing means you want to bid high. Two, if some other joker bids even higher, you pay what you bid, so you bid reasonable. But not as high as you would if you paid nothing for losing. In the end, the money paid out to the seller ends up being roughly equal over time.

Personally, I'd choose the Glum Loser's style, just cause I'm a sadistic bastard and I'd want you to pay and not get anything out of it.

and for the guy who said there's always some joker out there to bid millions on some trinket... sure there is. There's also another joker to bid 103 million. And then you're screwed. Thats why people wouldn't. Or if you would, and you default, you're banned from the auction system and thus you can't.

A comment on IQ testing

[ajna]

While I agree with your general point, your example of IQ testing is unfortunate. As explained to some length in Steven J Gould's "The Mismeasure of Man" IQ tests were actually calibrated from the start the other way: people in "high" professions score high on the test because the test was calibrated such that they are scored highly. While I am certainly no anti-intellectual (and have benefitted greatly from such testing), I still feel that holding forth the example of the inception of IQ testing as good science is flat-out wrong.