How Much is Location Privacy Worth

Abstract

Abstract. We use techniques from experimental economics and psychology to determine how much compensation must be offered to persuade someone to allow precise information about their location to be collected. We pretend that we are running a study that needs volunteers to have their location monitored (via their mobile phone) over a period of one month. Volunteers apply by specifying the amount of compensation which they would require to participate in the experiment. The experimental subjects are led to believe that we will run a sealed-bid second-price auction on these values, and thus we obtain an estimate of the value that users attach to their location data being used by third parties. 1