关键词: 模型, 隐私, 市场进入

Abstract: To get better services, consumers sometimes choose to provide their personal privacy to manufacturers. In this paper, a circle city model was developed, in which consumers decided how much privacy information they were willing to provide to manufacturers while the manufacturers competed for consumer privacy information and derived revenue from consumer purchases and privacy disclosure. It also analyzed the impact of disclosure of consumer privacy on the marketplace, and investigated the impact of optimal market entry on social welfare. The result shows that the market is not fully covered when the consumers’ willingness to pay is low and the differentiation is great. In this case, the optimal pricing of the manufacturers may be negative, and the optimal pricing and maximizing profits of the manufacturers increase but the privacy disclosure decreases with the willingness to pay. The market is fully covered when the consumers’ willingness to pay is low and the differentiation is small, or when the consumers’ willingness to pay is high. In this case, the manufacturers choose not to disclose consumer privacy if the consumers’ willingness to pay is high. Otherwise, the manufacturers derive revenues from both consumer purchase and privacy disclosure. Pricing and profit increase with the increase of differentiation, and decrease with the increase of the number of manufacturer. The optimal market entry analysis shows that the number of manufacturers under the condition of free entry is excessive compared with the number of manufacturers under the maximization of social welfare. However, the level of privacy disclosure with free entry equals that with maximum social welfare. From the perspective of regulation, it means that the provision of consumer information and the disclosure of privacy information can realize the requirement of social optimum if the level of disclosure is informed to consumers.

Key words: Salop model, privacy, market entry