Arguments against consumers selling their personal data lack historical perspective from labor markets.
The Wall Street Journal published a piece in October featuring Christopher Tonetti, Stanford Associate Professor of Economics. In the article, Tonetti presents an argument in favor of letting consumers sell their own personal data.
He shows that today data is under-shared because companies like Facebook and Google competitively hoard it in silos. This increases corporates’ advantage in the ad-sales market.
Therefore, placing data property rights in hands of consumers spurs innovation by leading to broader access to data. He gives an example how in his research paper from August 2019, Nonrivalry and the Economics of Data:
To put this concretely, suppose doctors use software to help diagnose skin cancer. An algorithm can be trained using images of potential cancers labeled with pathology reports and cancer outcomes. Imagine a world in which hospitals own data and each uses labeled images from all patients in its network to train the algorithm. Now compare that to a situation in which competing algorithms can each use all the images from all patients in the United States, or even the world. The software based on larger samples could help doctors everywhere better treat patients and save lives. The gain to any single hospital from selling its data broadly may not be sufficient to generate the broad use that is beneficial to society… Consumers owning their medical data and selling it to all interested researchers, hospitals, and entrepreneurs may result in a world closer to the social optimum in which such valuable data is used broadly to help many.
What is it about data?
Tonetti observes that data is nonrival – it doesn’t diminish with use. One hundred companies may use your data simultaneously. Given Facebook prefers to silo your data so others cannot compete, the nonrival aspect of data certainly justifies consumers selling their own personal data.
But there are moral justifications too. Personal data is like your fingerprints or a baseball card with stat lists of your most intimate details. You certainly should be in control over that! And control means the right to keep private, share, or sell. It means having dignity.
Comparing two labor markets
In fact, the moral justification is the strongest. My empirical evidence for this draws from labor markets. As with data, we can compare two labor markets. In the first, individuals sell their own labor. In the second, individuals are not in control.
We have historical evidence for both markets. Today in the USA we live in a labor market in which individuals may sell their own labor. Before the Civil War of the 1860s (and for too long afterwards) and in Egypt ~3000 years ago of Moses’ time, blacks and Hebrews were not in control of their own labor.
Clearly, placing moral arguments aside for now, today’s free market labor economy (the one in which individuals gain skills, apply for jobs, and market their own employability) coordinates labor in complex ways efficiently. The “Invisible Hand” works.
But labor IS rival. I cannot work for a construction company and food retailer at the same time. So the rationale between why labor and data markets operate more efficient with individuals in control is something else…
Dignity is the difference
Personal labor and data are dignified expressions of humans. What happens when you place a man’s dignity in the possession of another person? You embarrass him. Ultimately, you decrease his will to live. You see greater levels of addiction and suicide. You have anger and social unrest en masse.
Return her dignity to her, and you restore her sense of self. You may give her wings. You will unleash her godly instincts. You will ring in an era of renewed prosperity for her world. Are you with her? Join the movement here.
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