Question: One of the lingering impediments to e-business revolves around privacy concerns. Virtually all Web sites collect user data. Internet service providers, for example, can track where users go on the Web and store that information. Search engines keep detailed data on Internet searches by users. Those arguing that additional privacy laws and regulations are needed claim that users never know exactly what information is collected, nor when it is collected. Moreover, there is no means for determining whether Web sites follow their own privacy policies. On the other hand, some say current laws and regulations are adequate because they make it illegal for firms to misrepresent their privacy policies or fail to disclose the type of information collected. Furthermore, there is no evidence that Internet companies are quietly passing on specific customer information to outside parties. Aside from the strictly legal issues, Web privacy raises a number of ethical issues as well. Assume your company collects and stores personal information about its online customers. The company's privacy policy allows the company to give limited amounts of that information to "selected" third parties.

1. Is this policy, in your opinion, appropriate and adequate? What ethical issues does your company's policy raise?

2. How would you change the privacy policy to reflect your ethical concerns?

3. From strictly an economic perspective, is the company's existing policy adequate and appropriate?