Privacy-Seeking Behavior in the Personal Data Market
Referentin: Joy Wu (ISTO)
Firms are looking to commercialize, trade, and monetize the personal data they collect and receive from consumers. Internet users regularly choose to disclose and share their personal data in return for goods and services. This study examines whether a data recipient's ability to exploit data in a secondary market can motivate users' privacy behavior. An online experiment elicited individuals' willingness and reservation prices for sharing their personally-identifiable psychometric data when faced with real privacy consequences. I found that individuals' information disclosure behaviors were misaligned with their willingness to allow data recipients to monetize their data and trade with a third party. Individuals behaved more privately---by refusing to share data or by demanding greater benefits in exchange for privacy losses---when they became more aware of a data recipient's ability to sell their data for money. Moreover, when individuals considered allowing access to and exposing their data to many recipients, the privacy responses were weaker than the responses to just one recipient's exploitation abilities.
Performance-related CEO Dismissal and Innovation Performance
Referent: Ali Samei (TUM)
Among different types of CEO turnovers, performance-related CEO dismissals are usually a response to the request by unhappy shareholders to turn around a troubled firm. This may have negative long-term consequences for firms if the pressure to deliver short-term returns disincentivizes newly appointed CEOs from pursuing relatively risky and uncertain, but important, long-term growth strategies. In this study, using a sample of CEO turnover events among S&P 1500 firms over 18 years, we find that (only) performance-related CEO dismissals have a long-lasting negative effect on the amount of innovation a firm produces starting from the year immediately following a dismissal. Our results also show that the higher percentage of informed institutional investors, higher voting power of board directors, and the existence of a family relative of the CEO among the board of directors, will reverse or weaken the negative effect of performance-related CEO dismissal on innovation. We provide several robustness tests to rule out alternative explanations. The paper thus provides important insights into the potential negative long-term consequences of the CEO dismissals for firms and how these consequences can be mitigated.