Jan Bouckaert, Hans Degryse

Default Options and Social Welfare: Opt In versus Opt Out

Jahrgang 169 () / Heft 3, S. 468-489 (22)

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We offer a social-welfare comparison of the two most prominent default options – opt in and opt out – using a two-period model of localized competition. We demonstrate that when consumers stick to the default option, the prevailing default policy shapes firms' ability to collect and use customer information, and affects their pricing strategy and entry decision differently. The free-entry analysis reveals that fewer firms enter under opt out as competition becomes harsher, and that opt out is the socially preferred default option.

Jan Bouckaert Keine aktuellen Daten verfügbar.

Hans Degryse Keine aktuellen Daten verfügbar.