Using stated-preference data to measure the inconvenience cost of spam among Korean E-mail users

Abstract

E-mail is an efficient communication tool, but at the same time it is an efficient vehicle for Internet pollution in the form of spam—unsolicited, bulk e-mailings. Spam is a global phenomenon, and debate about possible means of controlling it is lively. Spammers impose a negative externality on users. The volume of spam-type e-mail sent is above the social optimum and thus produces dead-weight. To solve the spam problem and evaluate spam-control measures, one needs to measure the disutility experienced by e-mail users who receive spam. The current study employs conjoint analysis of stated-preference data to estimate e-mail users’ overall inconvenience cost attributable to spam. The results show the inconvenience cost of spam to be about 3.067 won (US$ 0.0026) per spam message.

Notes

¹ Attention bond mechanism is an economic solution to spam that allocates e-mail receivers’ attention. Each receiver set the size of attention bond that can be adjusted to receivers’ opportunity costs and e-mail is delivered after receivers’ permission.

² According to Ferris Research (2003) spam cost US corporations more than $10 billion in 2003. The Korean Information Security Agency (2003) and Nara Research (2004) reported that in Korea spam cost $11 billion and $43 billion in 2003 and 2004 respectively.

³ Yoo et al . (2005) estimated consumers’ willingness to pay for a spam-blocking program using a contingent valuation method.

⁴ Part-worth is calculated as estimate times variation between the maximum and minimum levels of an attribute.

⁵ In the case of obscene spam, willingness to pay for a decrease of one message can be calculated as follows:

where SNUM and ANUM represent the average number of spam messages received and average number of e-mail accounts held, respectively.

⁶ According to the International Telecommunications Union (2004), some 36% of spam consists of an attempt to deceptively sell something or perpetrate a scam or fraud.