Personalizing Prices in E-Commerce: The Ethics of a (Kind of) New Pricing Practice

This webinar will be hosted via Zoom, please register using the link.

Online retailers are using advances in data collection and computing technologies to “personalize” prices, i.e., offer goods for sale to shoppers at their reservation prices, or the highest amount they are willing to pay. In this paper, Jeffrey offers a criticism of this practice. He begins by putting online personalized pricing in context. It is not something entirely new, but rather a kind of price discrimination, a familiar pricing practice. He then consider two arguments against it, both of which focus on distinctive aspects of online personalized pricing, as it is currently practiced. According to one, online personalized pricing is wrong because it involves an invasion of privacy. This argument is weak because it assumes, controversially, that retailers’ websites are properly conceived of as private spaces. A better argument against online personalized pricing appeals to fairness. When an online retailer personalizes prices, it competes unfairly for the social surplus created by a transaction. Jeffrey will defend this argument against objections, and offer a simple remedy: online retailers should either disclose that they are personalizing prices, or stop doing so.