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Document Type

Article

Publication Date

4-2006

Publication Citation

58 Federal Communications Law Journal 321 (2006)

Abstract

The growing ubiquity of electronic media and the almost total absence of cost in mass distributions of direct marketing have exacerbated the problem of the increasing intrusion of direct marketing into the privacy of citizens. The Author proposes utilization of a microeconomic social welfare analysis to guide policymakers in determining what forms of direct media should be regulated and what the most effective forms of regulation are likely to be. Sending and receiving costs provide the key factors in determining the extent of the "welfare-reducing marketing" and "marketing aversions," but the Author points to a number of other factors as well, including impact on third parties, impact of economic and technological factors, and changes in volume and targeting in traditional channels. The Author's analysis suggests that increasing the receiver's ability to process information by imposing labeling requirements on distributors could increase welfare without having to resort to the more sweeping and inefficient opt-in or opt-out programs. Many of these solutions can be effectuated by industry and, thus, do not necessarily require government intervention. In the absence of effective industry-based solutions, the Author contends that a complete ban on direct marketing may be required in the electronic media in particular.