Sometimes, that will mean exploiting people who are not of a particular class, say upcharging men for flowers if a computer recognizes that that he’s looking for flowers the day after his anniversary. But other times there could be troubling equity concerns. For example, Calo points to the work of NYU professor Oren Bar-Gill who has shown how companies can use complexity in credit-card contracts, mortgages, and cell-phone contracts to “hinder or distort competition and impose outsized burden on the least sophisticated consumers.” Calo says such price-discrimination tactics, applied en masse online, could “lead to regressive distribution effects,” also known as preying on the vulnerable.
From the paper, Digital Market Manipulation
A new theory of digital market manipulation reveals the limits of consumer protection law and exposes concrete economic and privacy harms that regulators will be hard-pressed to ignore. This Article thus both meaningfully advances the behavioral law and economics literature and harnesses that literature to explore and address an impending sea change in the way firms use data to persuade.