On 9 June 2023, Franziska Weber, Professor of Law & Economics at Erasmus School of Law, delivered her inaugural lecture. In her lecture titled To share or not to share – that is the question, Weber sheds light on the social, legal, and economic aspects of sharing other people's data and provides recommendations for correctly (re-)interpreting current privacy legislation.
Data is often considered to be the new gold, and protecting our data is more relevant than ever. An overlooked topic is how to handle other people's data. For instance, when someone writes a letter to their landlord using ChatGPT, they are (often unknowingly) sharing someone else's data. The home voice assistant also collects information from others while homeowners are having conversations with their guests. Additionally, through data mining and inferences, other people's data is indirectly generated. Therefore, sharing data of others can happen consciously or unconsciously. Weber’s research focuses on how to handle other people’s data and what the law says about it or should say about it.
Legal intervention is urgently needed
Our data protection legislation, such as the General Data Protection Regulation (GDPR), is based on the principle of individual autonomy, where consent for data sharing is essential. “But if someone else shares your data, you do not have the opportunity to give or refuse consent", Weber explains.
Literature describes this phenomenon as ‘data externalities’. They lead to a decrease in social welfare due to decreased levels of privacy. Data is shared too excessively. This not only violates privacy of an individual but can also lead to financial harm, according to Weber: "A well-known phenomenon is price discrimination, where a company asks individualised prices per user based on their willingness to pay. Companies are very interested in this information for their pricing strategies and profits". In addition to the negative externalities, positive externalities can also occur through data sharing, such as sharing data that contributes to the development of new medicines or even simpler benefits like getting better music recommendations.
In addition to the aforementioned data externalities, Weber identifies other forms of market failure that provide a basis for legal intervention to better protect data. Firstly, privacy is classified as a public good. Additionally, the phenomenon of information asymmetry (underpinned by insights from behavioural law and economics) can be applied.
In short, we share too much, and companies collect too much. This leads to a complex societal problem that requires legal intervention.
But how do we determine what benefits society?
"This depends on the interests of all citizens and other relevant actors. We need to understand how individuals behave in data markets and what they truly want in order to formulate appropriate economic privacy policies", Weber explains.
"Be cautious with your data and that of others"
The current data and privacy legislation is clearly tailored to individuals and their personal data, neglecting the effects of directly and indirectly sharing other people's data.
Therefore, Weber advocates for a re-evaluation of the current privacy legislation. Her experimental research showed that "awareness of external effects does indeed affect individual sharing behaviour, which calls for more options to enable individuals to exhibit this behaviour". This is especially true if it is very clear that someone is also sharing someone else's data. Furthermore, "the sharing of someone's personal data and the indirect sharing of others' data are often inevitably intertwined. The main way to reduce the excessive sharing of data by individuals seems to be reducing the excessive sharing of someone's own data".
Therefore, Weber invites everyone to be more cautious when it comes to data sharing: "I invite you to reconsider how quickly you accept excessive data sharing the next time you encounter a cookie banner. By accepting only necessary cookies, we can all contribute to reducing externalities and their negative societal consequences."