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Assigning Property Rights to Internet Data Creators



(p. C3) Congress has stepped up talk of new privacy regulations in the wake of the scandal involving Cambridge Analytica, which improperly gained access to the data of as many as 87 million Facebook users. Even Facebook chief executive Mark Zuckerberg testified that he thought new federal rules were "inevitable." But to understand what regulation is appropriate, we need to understand the source of the problem: the absence of a real market in data, with true property rights for data creators. Once that market is in place, implementing privacy protections will be easy.

We often think of ourselves as consumers of Facebook, Google, Instagram and other internet services. In reality, we are also their suppliers--or more accurately, their workers. When we post and label photos on Facebook or Instagram, use Google maps while driving, chat in multiple languages on Skype or upload videos to YouTube, we are generating data about human behavior that the companies then feed into machine-learning programs.

These programs use our personal data to learn patterns that allow them to imitate human behavior and understanding. With that information, computers can recognize images, translate languages, help viewers choose among shows and offer the speediest route to the mall. Companies such as Facebook, Google and Microsoft (where one of us works) sell these tools to other companies. They also use our data to match advertisers with consumers.

Defenders of the current system often say that we don't give away our personal data for free. Rather, we're paid in the form of the services that we receive. But this exchange is bad for users, bad for society and probably not ideal even for the tech companies. In a real market, consumers would have far more power over the exchange: Here's my data. What are you willing to pay for it?

An internet user today probably would earn only a few hundred dollars a year if companies paid for data. But that amount could grow substantially in the coming years. If the economic reach of AI systems continues to expand--into drafting legal contracts, diagnosing diseases, performing surgery, making investments, driving trucks, managing businesses--they will need vast amounts of data to function.

And if these systems displace human jobs, people will have plenty of time to supply that data. Tech executives fearful that AI will cause mass unemployment have advocated a universal basic income funded by increased taxes. But the pressure for such policies would abate if users were simply compensated for their data.



For the full commentary, see:

Eric A. Posner and E. Glen Weyl. "Want Our Personal Data? Pay for It." The Wall Street Journal (Saturday, April 21, 2018): C3.

(Note: the online version of the commentary has the date April 20, 2018.)


The commentary quoted above, is based on:

Posner, Eric A., and E. Glen Weyl. Radical Markets: Uprooting Capitalism and Democracy for a Just Society. Princeton, NJ: Princeton University Press, 2018.






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