The Rise of Behavioural Discrimination

Posted by Social Science Research Network

The Rise of Behavioural Discrimination

Ariel Ezrachi (University of Oxford) & Maurice E. Stucke (University of Tennessee)

Abstract:      The increased personalization of our online environment has been noticeable in recent years. Firms track us, collect data about us, and target us with the right ad at the right time – all to transform our web environment into a personal space. Some welcome this personalisation. The advertisements and promotion are tailored to our particular interests. In timely receiving this relevant information, we can save time shopping. Yet, this personalised shopping experience may come at a cost. It increases the risk of a biased, distorted environment in which we, as users, are manipulated. Such an environment can pave the way for behavioural discrimination – the ability of sellers to induce us to buy things we otherwise wouldn’t, at the highest price we are willing to pay. The new paradigm affects not only our pocketbook but our social environment, trust in firms and the marketplace, privacy, personal autonomy, and ultimately well-being.