Pricing Electronic Mail to Solve the Problem of Spam

Junk e-mail or spam is rapidly choking off e-mail as a reliable and efficient means of communication over the Internet. Although the demand for human attention increases rapidly with the volume of information and communication, the HUMAN-COMPUTER INTERACTION, 2005, Volume 20, pp. 195–223 Copyright © 2005, Lawrence Erlbaum Associates, Inc. Robert Kraut is a social psychologist with interests in the social impact of computer technologies and especially computer-mediated communication; he is a Herbert A. Simon Professor of Human Computer Interaction in the Human Computer Interaction Institute at Carnegie Mellon University. Shyam Sunder is an economist with interests in the Contract Theory of Accounting and Control, experimental economics, and electronic commerce; he is a James L. Frank Professor of Accounting, Economics and Finance in the School of Management at Yale University. Rahul Telang is an economist with interests in the economics of information security and economic models of user choices; he is an assistant professor at the Heinz School of Public Policy and Management at Carnegie Mellon University. James Morris is a computer scientist with an interest in computer-mediated communication; he is Dean of Carnegie Mellon University’s West Coast campus and professor of Human Computer Interaction at Mellon University. supply of attention hardly changes. Markets are a social institution for efficiently allocating supply and demand of scarce resources. Charging a price for sending messages may help discipline senders from demanding more attention than they are willing to pay for. Price may also credibly inform recipients about the value of a message to the sender before they read it. This article examines economic approaches to the problem of spam and the results of two laboratory experiments to explore the consequences of a pricing system for electronic mail. Charging postage for e-mail causes senders to be more selective and to send fewer messages. However, recipients did not interpret the postage paid by senders as a signal of the importance of the messages. These results suggest that markets for attention have the potential for addressing the problem of spam but their design needs further development and testing.