Abstract Many e-commerce platforms use buyers’ personal data to intermediate their transactions with sellers. How much value do such intermediaries derive from the data record of each single individual? We characterize this value and find that one of its key components is a novel externality between records, which arises when the intermediary pools some records to withhold the information they contain. Our analysis has several implications about compensating individuals for the use of their data, guiding companies’ investments in data acquisition, and more broadly studying the demand side of data markets. Our methods combine modern information design with classic duality theory and apply to a large class of principal-agent problems.

Abstract We conduct an experimental analysis of selective disclosure in communication. In the model, an informed sender aims to influence a receiver by disclosing verifiable evidence that is selected from a larger pool of available evidence. Our experimental design leverages this model’s rich comparative statics, allowing us to systematically quantify the effects of selection relative to concealment. Our findings confirm the key qualitative predictions of the theory, suggesting that selection, rather than concealment, is often the dominant distortion in communication. We also identify deviations from the theory: Some senders are “deception averse” and overcommunicate relative to predictions; receivers respond too optimistically to both concealed and selected evidence, with errors of similar magnitude. Yet selection generates greater overall distortion in receiver behavior because it is far more prevalent than concealment.