Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/192877 
Year of Publication: 
2019
Series/Report no.: 
DICE Discussion Paper No. 308
Publisher: 
Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE), Düsseldorf
Abstract: 
This paper investigates how privacy regulation affects the structure of online markets. We provide a simple theoretical model capturing the basic trade-off between the degree of privacy intrusion and the informativeness of advertising. We derive empirically testable hypotheses regarding a possibly asymmetric effect of privacy regulation on large and small firms using a diff-diff-diff model with heterogeneous treatment timing. Our theoretical model predicts that privacy regulation may affect predominantly large firms, even if - as our data confirms - these large firms tend to offer more privacy. Our empirical results show that, if any, only large firms were negatively affected, suggesting that privacy regulation might boost competition by leveling out the playing field for small firms.
Subjects: 
Privacy
Competition
Regulation
ePrivacy Directive
JEL: 
D43
L86
M37
M38
ISBN: 
978-3-86304-307-0
Document Type: 
Working Paper

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