Affiliate Catherine Tucker and Analysis Group Coauthors Contribute Chapter on Privacy, Competition, and Regulation to Research Handbook on Data, Privacy and Competition Law

December 18, 2025

For the Research Handbook on Data, Privacy and Competition Law, academic affiliate Catherine Tucker, Vice President Philipp Tillmann, and Manager Olga Kozlova Guglielmi coauthored a chapter on the economics of consumer privacy and competition. In “The Interplay of Consumer Privacy, Competition, and Regulation,” the authors explore the economics of consumer privacy and competition and discuss how regulation of consumer privacy interacts with competition.

The authors review literature suggesting consumers’ valuation of privacy is heterogeneous and context dependent and note that consumers’ observed choices (e.g., their willingness to share photos online) and their general reported preference for data privacy are often contradictory. This “privacy paradox” may reflect consumers’ limited capacity to review and understand privacy terms as well as their willingness to trade off privacy for product benefits such as more relevant search results. The authors explain that, although consumer privacy can be framed as a product feature on which firms compete, greater competition does not necessarily lead to better privacy protections. For example, when product functionality is negatively correlated with privacy, such as with dating apps that leverage personal information to improve the quality of matches, competition may lead firms to invest in or promote product features that are more reliant on data sharing, which can reduce privacy. The authors conclude that the increasingly stringent regulation of privacy can have “nuanced and sometimes unintended effects on consumer privacy and competition.” Specifically, they evaluate evidence that regulation may disproportionally favor larger companies due to the costs of compliance and because both firms and consumers may be more willing to share their data with established vendors.

Research Handbook on Data, Privacy and Competition Law is available for sale on the Edward Elgar Publishing website.