Prof. Song Ma Wins Jensen Prize for Research on Data Markets
The Journal of Financial Economics recognized Ma and his co-authors for research showing how to value data and how to design the markets where it is traded—questions that have become central in the age of AI.
Song Ma, professor of finance and entrepreneurship at Yale SOM, has received the 2025 Jensen Prize from the Journal of Financial Economics for his paper “Data Sales and Data Dilution.”
Presented annually, the prize recognizes the best corporate finance and organizations paper published in the Journal of Financial Economics, a peer-reviewed academic journal. Ma co-authored the paper with Ernest Liu, associate professor of economics at Princeton University, and Laura Veldkamp, professor of finance at Columbia Business School.
In the paper, Ma and his co-authors tackle two questions at the heart of the AI economy: how to value data, and how to design the markets where data is bought and sold. Data has become the essential input for AI and a core asset of modern firms, yet economists have offered little guidance on how it should be priced.
The authors show that data sellers have less pricing power than they appear to. Because data can be copied at virtually no cost, a seller cannot commit to limiting future sales—and buyers know it. Moreover, through what the authors call “data dilution,” data becomes less valuable to each buyer as more of the buyer’s competitors gain access to it. Together, these forces mean that a data seller effectively competes against its own future self, driving prices down. The real risk in the data economy, the authors argue, is not that data monopolists overcharge, but that weak pricing power erodes sellers’ incentives to produce high-quality data.
Market design, the paper shows, offers a remedy. Subscription models—where buyers pay for continued access to a dataset—restore sellers’ pricing power and strengthen their incentives to invest in high-quality data, ultimately benefiting data buyers as well. Examining more than 3,000 products on one of the largest online data marketplaces, the authors find pricing patterns consistent with the theory. The results provide a framework for valuing data and designing data markets at a moment when regulators around the world are weighing how to govern the data that fuels AI.
A member of the SOM faculty since 2016, Ma is also a faculty research fellow at the National Bureau of Economic Research and an affiliated faculty member at the Yale Law School Center for the Study of Corporate Law and SOM’s Program on Entrepreneurship. Earlier this year, he was named a Young Global Leader by the World Economic Forum. He previously won the Jensen Prize in 2018 for his paper “How Does Hedge Fund Activism Reshape Corporate Innovation?”
Ma’s research interests include innovation economics, entrepreneurship, financial economics, AI, and big data. His work has been cited by policymakers around the world, including at the Federal Trade Commission and the European Commission.
