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Measuring Price Discrimination and Steering on E-commerce Web Sites

Northeastern University: “Internet users reg­u­larly receive all kinds of per­son­al­ized con­tent, from Google search results to product rec­om­men­da­tions on Amazon. This is thanks to the com­plex algo­rithms that pro­duce results based on users’ pro­files and past activity. It’s Big Data at work, and it’s often advan­ta­geous for users. But such per­son­al­iza­tion can also be a dis­ad­van­tage to buyers, according to a team of North­eastern Uni­ver­sity researchers, when e-​​commerce web­sites manip­u­late search results or cus­tomize prices without the user’s knowledge—and which in some cases leads to some online shop­pers paying more than others for the same thing. This trans­parency issue is at the core of a first-​​of-​​its-​​kind study co-​​authored by five North­eastern fac­ulty and stu­dents, including assis­tant pro­fes­sors Christo Wilson and Alan Mis­love of the Col­lege of Com­puter and Infor­ma­tion Sci­ence and pro­fessor David Lazer, who holds joint appoint­ments in CCIS and the Col­lege of Social Sci­ences and Human­i­ties. In a new research paper, the team exam­ined 16 pop­ular e-​​commerce sites (10 gen­eral retailers and six hotel and car rental sites) to mea­sure two spe­cific forms of per­son­al­iza­tion: price dis­crim­i­na­tion, in which a product’s price is cus­tomized to the user; and price steering, in which the order of search results are cus­tomized to the user.”

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