Discussion Paper Series 2023-E-2

Seeking the Ideal Privacy Protection: Strengths and Limitations of Differential Privacy

Kazutoshi Kan

In modern society where personal information has high industrial value, privacy protection is a mandatory prerequisite for utilizing the personal information. Differential privacy enables to achieve moderate privacy through quantifying the effectiveness of privacy-enhancing technologies. Many researchers have adopted differential privacy as a common and useful criterion in academic literatures regarding the privacy evaluation. This paper gives an overview of principles, laws, regulations, IT systems management, business practices, and privacy-enhancing technologies including ones based on differential privacy. It also explains the theory behind differential privacy and its application studies, and discusses the desirable privacy protection considering the strengths and limitations of the differential privacy. In particular, mathematical methodologies including ones based on differential privacy cannot solely suffice social demands for privacy protection, especially for the control over personal information about oneself. Desirable privacy protection for resolving the social issue should adopt a comprehensive approach that includes laws, regulations, IT systems management, business practices, as well as mathematical methodologies and information security.

Keywords: Differential Privacy; Privacy Protection; Control over Personal Information about Oneself; Anonymization; Ethical, Legal and Social Issues

Views expressed in the paper are those of the authors and do not necessarily reflect those of the Bank of Japan or Institute for Monetary and Economic Studies.

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