Valuing Personal Data with Privacy Consideration

A key challenge in information privacy research is how to value personal data with privacy consideration. In this study, we propose an experimental auction approach for valuing personal data. We use the generalized second-price auction to assess the monetary values of individuals' identity, demographic, and private information. We find that individuals' economic valuation of personal data is consistent with their actual self-disclosure behaviors. The economic valuation approach also produces results that are consistent with some well-accepted observations about consumer demographics and privacy. On the other hand, individuals' stated privacy preferences and attitudes are not consistent with their economic valuation. The findings of this study suggest that the proposed approach can be an effective mechanism for measuring personal data privacy. This study also provides important insights into valuing personal information for practical uses with several implications to policy decision makers, corporate executives and managers, data analysts, as well as decision science researchers.