The Invisible Risk: The Data-sharing Activities of Data Brokers and Information Leakage

Abstract

Data brokers are the major players in the market for collecting, selling and sharing user information. This paper considers data brokers’ data sharing activities as a co-opetition between data brokers and investigates how the information collecting and sharing activities may lead to information leakage on the dark web. We find that S&P 1,500 firms experience higher information leakage when sharing more customer information with data brokers through third-party cookies. Further, using all the registered data brokers and their competitors as the sample, we observe that registered data brokers are more susceptible to information leakage with data sharing activities than unregistered data brokers. Our study provides initial evidence on the consequences of data brokers’ data sharing activities