Comment by zwaps | Hacker News Reader

Comment by zwaps | Hacker News Reader

I think it is a step forward to pay users for data. Of course, amazon still collects everything it can anyway, for free. But in principle, this is good. But two things.

1. What is the correct price? Amazon is doing this to better discriminate customers on offerings, price and quality. It's essentially the sophisticated version of what econ 101 calls "siphoning off the consumer surplus by price discrimination". At this stage, it is highly doubtful that the fixed 10 bucks actually represents the true value that the consumer's data.

2. Externalities. Especially considering that amazon can classify you by other means, people that are like you getting these 10 bucks means that amazon increases its discriminatory power toward you - whether you have gotten the money or not. This is a negative externality - one that the market simply can not solve because we fundamentally lack information and this behavior essentially induces a prisoners dilemma among consumers. Amazon is going to know everything anyway, so I might as well take the 10 bucks.

I don't find it a step forward at all. It's a move toward pricing out the privacy-conscious. Right now, auto insurers in Canada will give you a premium reduction if you let them spy on you as you drive. But what happens when that becomes the norm? People end up paying a premium to not be spied on. Eventually privacy becomes unaffordable.

Privacy becomes worth what the market will bear. If that's unaffordable, that's just because it's valuable.

There's all sorts of other premiums on the exercise of your rights in a private context. It's very hard to get a job in information sectors that lets you retain copyright of your creative work, or in general a job that lets you exercise your freedom of speech without potentially risking your job. If you have physical handicaps, it's more expensive to get a house and a car that are accessible (because there are fewer opinions on the market), you can't necessarily use public transit, and your choice of jobs is also quite limited. Medication and treatment for chronic conditions, whether physical or mental, often exceeds what your insurance will pay. Having a child is quite expensive. If someone has wronged you, depending on the issue, getting a lawyer may be very pricy.

If we think that the market should not set a price for certain desirable basic things, it seems like the fault is on society for allowing and encouraging the market to do so in general, not on the market participants for taking rational advantage of it in particular cases. Personally, I'm of the opinion that everyone should get privacy for free, but I'm also of the opinion that everyone should get health care for free.

In societies which enforce human rights, privacy is upheld through laws, not left to the market.

Leaving it to the market leads to horror scenarios like the one we have to live through right now: the USA's banana republic privacy laws are hurting all of us.

> If we think that the market should not set a price for certain desirable basic things, it seems like the fault is on society for allowing and encouraging the market to do so in general, not on the market participants for taking rational advantage of it in particular cases.

It can be both.

> it seems like the fault is on society for allowing and encouraging the market to do so in general

I agree, but there's no underlying constant that humans act rationally or in their own best interest. I don't think the market can protect rights, period. And putting a price on them marginalizes the poor even more.

> Privacy becomes worth what the market will bear. If that's unaffordable, that's just because it's valuable.

You could substitute workday length or child labor or any other undesirable attribute of a society into that sentence. There are some things better not left up to "the market".

It won't become unaffordable, it'll just be like cable tv did to commercials. Once they started airing them, they didn't go away, and now you can't get cable without commercials.

The other side of this is people paying a premium to subsidize other unsafe drivers.

Well, more precisely, people who care about privacy more than price paying a premium to subsidize anyone with the opposite priority.

That only loosely correlates with driver safety, especially since a bad claims history has an independent impact on price.

Assuming it only loosely correlates, then the premium difference between a driver opting into tracking will be small compared to those opting out.

I would say this is only tangentially related to the real issue, which is how collected data is used.

There is a huge difference between the scenario you describe, where a company is using your data in an attempt to help you improve your life (save money). vs. A company who takes your data and uses it for profit-generating endeavors that you did not willfully consent to.

I think this is just a perceived prisoners dilemma where you don’t actually win if you cooperate.

What people probably think: If I install the plugin, Amazon can always beat the target and walmart price for me.

The reality: this lets Amazon increase their prices on cheaper goods to within a tiny fraction of what walmart and target offer, and also build a psychological model of the consumer to charge a bit more depending on their state of mind (Tired? Rushed? Pissed off at Trump today, and therefore red-state-headquartered Walmart?), etc, etc.

Most people that install this will only see the first order effect though — $10 and more convenient comparison shopping.

Of course there is another category: People that understand the game, and think they can beat the house. They should install it too (and then go try to make money playing slots at a casino).

Prisoners dilemma also works with appropriately sized losses, which is what this is.

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