Privacy-Utility Tradeoff

Embodied AI (EAI) systems are rapidly transitioning from simulations into real-world domestic and other sensitive environments. However, recent EAI solutions have largely demonstrated advancements within isolated stages such as instruction, perception, planning and interaction, without considering their coupled privacy implications in high-frequency deployments where privacy leakage is often irreversible. This position paper argues that optimizing these components independently creates a systemic privacy crisis when deployed in sensitive settings, thereby advancing the position that privacy in EAI is a life cycle-level architectural constraint rather than a stage-local feature. To address these challenges, we propose Secure Privacy Integration in Next-generation Embodied AI (SPINE), a unified privacy-aware framework that treats privacy as a dynamic control signal governing cross-stage coupling throughout the entire EAI life cycle. SPINE decomposes the EAI pipeline into various stages and establishes a multi-criterion privacy classification matrix to orchestrate contextual sensitivity across stage boundaries. We conduct preliminary simulation and real-world case studies to conceptually validate how privacy constraints propagate downstream to reshape system behavior, illustrating the insufficiency of fragmented privacy patches and motivating future research directions into secure yet functional embodied AI systems. We detail the SPINE framework and case studies at https://github.com/rminshen03/EAI_Privacy_Position.

Tabular data synthesis aims to generate high-quality data while preserving privacy. However, we find that existing tabular generative models exhibit a clear tradeoff in the small-data regime: improving data quality typically comes at the cost of increased memorization of training samples, thereby weakening privacy protection. This tradeoff arises because small training sets make it difficult for dataset-specific generative models to distinguish generalizable structure from sample-specific patterns. To address this, we propose DiffICL, which formulates tabular data generation as an in-context learning problem. Instead of fitting each dataset from scratch,DiffICL leverages pretrained structural priors learned from a large collection of datasets, enabling it to infer data distributions from limited context rather than memorizing individual samples. We evaluate DiffICL on 14 real-world datasets. Results show that DiffICL improves both data quality and privacy, and generate synthetic data that provides effective data augmentation. Our findings suggest that the quality-privacy tradeoff can be improved through better training paradigms.

Standard differential privacy imposes uniform privacy constraints across all features, overlooking the inherent distinction between sensitive and insensitive features in practice. In this paper, we introduce a relaxed definition of differential privacy that accounts for such heterogeneity, allowing certain features to be treated as insensitive even when correlated with sensitive ones. We propose a correlation-aware framework, $\textsf{CorrDP}$, which relaxes privacy for insensitive features while accounting for their correlations with sensitive features, with the correlations quantified using total variation distance. We design algorithms for differentially private empirical risk minimization (DP-ERM) under the $\textsf{CorrDP}$ framework, incorporating distance-dependent noise into gradients for improved theoretical utility guarantees. When the correlation distance is unknown, we estimate it from the dataset and show that it achieves a comparable privacy-utility guarantee. We perform experiments on synthetic and real-world datasets and show that $\textsf{CorrDP}$-based DP-ERM algorithms consistently outperform the standard DP framework in the presence of insensitive features.

We study differential privacy (DP) in Graph Convolutional Networks (GCNs) through the framework of \textit{subsampling stability}. We derive upper bounds on the misclassification rate that depend explicitly on the subsampling probability $p_s$. Furthermore, we characterize the \textit{privacy--utility trade-off} by identifying feasible ranges of $p_s$; if $p_s$ is too large, the stability-based privacy condition becomes difficult to satisfy, yielding vacuous guarantees, whereas if it is too small, accuracy deteriorates. Our results provide the first rigorous theoretical framework for understanding subsampling stability in GCNs under DP.

Metric differential privacy (mDP) strengthens local differential privacy (LDP) by scaling noise to semantic distance, but many machine learning (ML) systems are consumed under joint observation, where model-agnostic, per-record guarantees can miss leakage from evidence aggregation. We introduce metric-normalized posterior leakage (mPL), an attacker-aligned, distance-calibrated measure of posterior-odds shift induced by releases, and show that for single or independent releases, uniformly bounding mPL is equivalent to mDP. Under joint observation, however, satisfying mDP may still leave mPL high because learned aggregators compound evidence across correlated items. To make control practical, we formalize probabilistically bounded mPL (PBmPL), which limits how often mPL may exceed a target budget, and we operationalize it via Adaptive mPL (AmPL), a trust-and-verify framework that perturbs, audits with a learned attacker, and adapts parameters (with optional Bayesian remapping) to balance privacy and utility. In a word-embedding case study, neural adversaries violate mPL under joint consumption despite per-record mDP perturbations, whereas AmPL substantially lowers the frequency of such violations with low utility loss, indicating PBmPL as a practical, certifiable protection for joint-consumption settings.

The goal of differentially private text obfuscation is to obfuscate, or "perturb", input texts with Differential Privacy (DP) guarantees, such that the private output texts are quantifiably indistinguishable from the originals. While perturbation at the word level is intuitive, meaningful text privatization happens on complete documents. Recent research has laid the groundwork for reasoning about privacy budget distribution, namely, how an overall $\varepsilon$ budget can be sensibly distributed among the component pieces of a text. We perform a systematic evaluation of multiple text decomposition and budget distribution techniques in the context of DP text obfuscation, testing how different methods for chunking texts can be combined with techniques for allocating $\varepsilon$ to these chunks. Our experiments reveal that such design choices are very important, as even with comparable privacy budgets, significantly different results can occur based on which methods are chosen. In this, we provide credible evidence of the feasibility of maximizing empirical trade-offs by optimizing DP obfuscation procedures.

We study $d$-dimensional unbiased mean estimation in the single-message shuffle model, where each user sends a single privatized message and the analyzer only observes the shuffled multiset of reports. While minimax-optimal mechanisms are well understood in the local differential privacy setting, the corresponding notion of optimality after shuffling has remained largely unexplored. To address this gap, we introduce the recently proposed shuffle index and use it to formulate the post-shuffling mechanism design problem as an explicit optimization problem. We then establish a minimax lower bound on the achievable mean squared error in terms of the shuffle index, which implies that mechanisms that are optimal under LDP can become suboptimal once shuffling is applied. Finally, we construct an asymptotically minimax optimal mechanism in the high privacy regime, which as a consequence achieves a privacy-utility trade-off nearly identical to that of the central Gaussian mechanism.

Differential Privacy (DP) for text matured from disjointed word-level substitutions to contiguous sentence-level rewriting by leveraging the generative capacity of language models. While this form of text privatization is best suited for balancing formal privacy guarantees with grammatical coherence, its impact on the register identity of text remains largely unexplored. By conducting a multidimensional stylistic profiling of differentially-private rewriting, we demonstrate that the cost of privacy extends far beyond lexical variation. Specifically, we find that rewriting under privacy constraints induces a systematic functional mutation of the text's communicative signature. This shift is characterized by the severe attrition of interactive markers, contextual references, and complex subordination. By comparing autoregressive paraphrasing against bidirectional substitution across a spectrum of privacy budgets, we observe that both architectures force convergence toward a non-involved and non-persuasive register. This register-blind sanitization effectively preserves semantic content but structurally homogenizes the nuanced stylistic markers that define human-authored discourse.

Balancing differential privacy (DP) with recommendation accuracy is a key challenge in privacy-preserving recommender systems, since DP-noise degrades accuracy. We address this trade-off at both the data and model levels. At the data level, we apply DP only to the most stereotypical user data likely to reveal sensitive attributes, such as gender or age, to reduce unnecessary perturbation; we refer to this as targeted DP. At the model level, we use meta-learning to improve robustness to remaining DP-noise. This achieves a better trade-off between accuracy and privacy than standard approaches: Meta-learning improves accuracy and targeted DP leads to lower empirical privacy risk compared to uniformly applied DP and full DP baselines. Overall, our findings show that selectively applying DP at the data level together with meta-learning at the model level can effectively balance recommendation accuracy and user privacy.

Consumers are increasingly delegating purchase decisions to AI agents, providing natural-language descriptions of their preferences and identity. We argue that these representations constitute an information channel, role coherence, through which sellers can infer willingness to pay without explicit disclosure by the buyer agent, leading to preference leakage. In an experiment where a language-model buyer agent shops on behalf of a verbal consumer profile, we show that seller-side inference from dialogue alone recovers willingness to pay nearly one-for-one. Comparing this setting to a numeric-budget condition with confidentiality instructions cleanly isolates role coherence as distinct from instruction-following failure. Because this leakage arises from delegation itself, it cannot be mitigated at the prompt level. Instead, we propose architectural interventions that trade off personalization against preference privacy.

The decentralization of modern energy systems is transforming consumers into prosumers who continuously exchange data with aggregators, peers, and market operators. While such data is essential for peer-to-peer trading, demand response, and distributed forecasting, it can reveal sensitive household patterns and introduce privacy risks. Existing data sharing mechanisms rely on fixed policies or predefined differential privacy budgets, limiting their ability to adapt to variations in reliability, data sensitivity, and request purpose. As a result, prosumers rarely receive explanations for why a request is accepted, rejected, or modified, reducing trust and participation. To address these limitations, we propose X-NegoBox, an explainable negotiation framework for adaptive privacy budgeting and transparent decision making. Each prosumer data is managed locally within a private DataBox, where raw data remain confined. Incoming requests are processed by an Autonomous Privacy Budget Negotiation Protocol (APBNP), which determines an appropriate privacy budget based on trust, feature sensitivity, declared purpose, historical behavior, and risk-aware pricing. When needed, APBNP generates privacy-preserving counter-offers, such as reduced resolution or duration. An Explainable Agreement Layer (X-Contract) produces human- and machine-readable justifications for each decision. After agreement, requester code executes locally in a sandbox, and only sanitized outputs are shared. Experiments on realistic energy market settings show reduced privacy leakage, higher acceptance rates, and improved interpretability.

Protecting patient privacy in clinical narratives is essential for enabling secondary use of healthcare data under regulations such as GDPR and HIPAA. While manual de-identification remains the gold standard, it is costly and slow, motivating the need for automated methods that combine privacy guarantees with high utility. Most automated text de-identification pipelines employed named entity recognition (NER) to identify protected entities for redaction. Although methods based on differential privacy (DP) provide formal privacy guarantees, more recently also large language models (LLMs) are increasingly used for text de-identification in the clinical domain. In this work, we present the first comparative study of DP, NER, and LLMs for Dutch clinical text de-identification. We investigate these methods separately as well as hybrid strategies that apply NER or LLM preprocessing prior to DP, and assess performance in terms of privacy leakage and extrinsic evaluation (entity and relation classification). We show that DP mechanisms alone degrade utility substantially, but combining them with linguistic preprocessing, especially LLM-based redaction, significantly improves the privacy-utility trade-off.

Human mobility data are used in numerous applications, ranging from public health to urban planning. Human mobility is inherently sensitive, as it can contain information such as religious beliefs and political affiliations. Historically, it has been proposed to modify the information using techniques such as aggregation, obfuscation, or noise addition, to adequately protect privacy and eliminate concerns. As these methods come at a great cost in utility, new methods leveraging development in generative models, were introduced. The extent to which such methods answer the privacy-utility trade-off remains an open problem. In this paper, we introduced a first step towards solving it, by the introduction and application of a new framework for utility evaluation. Furthermore, we provide evidence that privacy evaluation remains a great challenge to consider and that it should be tackled through adversarial evaluation in accordance with the current EU regulation. We propose a new membership inference attack against a subcategory of generative models, even though this subcategory was deemed private due to its resistance over the trajectory user-linking problem.

Despite the considerable promise of Retrieval-Augmented Generation (RAG), many real-world use cases may create privacy concerns, where the purported utility of RAG-enabled insights comes at the risk of exposing private information to either the LLM or the end user requesting the response. As a potential mitigation, using anonymization techniques to remove personally identifiable information (PII) and other sensitive markers in the underlying data represents a practical and sensible course of action for RAG administrators. Despite a wealth of literature on the topic, no works consider the placement of anonymization along the RAG pipeline, i.e., asking the question, where should anonymization happen? In this case study, we systematically and empirically measure the impact of anonymization at two important points along the RAG pipeline: the dataset and generated answer. We show that differences in privacy-utility trade-offs can be observed depending on where anonymization took place, demonstrating the significance of privacy risk mitigation placement in RAG.

Privacy preserving machine learning deployments in sensitive deep learning applications; from medical imaging to autonomous systems; increasingly require combining multiple techniques. Yet, practitioners lack systematic guidance to assess the synergistic and non-additive interactions of these hybrid configurations, relying instead on isolated technique analysis that misses critical system level interactions. We introduce PrivacyBench, a benchmarking framework that reveals striking failures in privacy technique combinations with severe deployment implications. Through systematic evaluation across ResNet18 and ViT models on medical datasets, we uncover that FL + DP combinations exhibit severe convergence failure, with accuracy dropping from 98% to 13% while compute costs and energy consumption substantially increase. In contrast, FL + SMPC maintains near-baseline performance with modest overhead. Our framework provides the first systematic platform for evaluating privacy-utility-cost trade-offs through automated YAML configuration, resource monitoring, and reproducible experimental protocols. PrivacyBench enables practitioners to identify problematic technique interactions before deployment, moving privacy-preserving computer vision from ad-hoc evaluation toward principled systems design. These findings demonstrate that privacy techniques cannot be composed arbitrarily and provide critical guidance for robust deployment in resource-constrained environments.

We consider the privacy amplification properties of a sampling scheme in which a user's data isused in $k$ steps chosen randomly and uniformly from a sequence (or set) of $t$ steps. This sampling scheme has been recently applied in the context of differentially private optimization (Chua et al., 2024a; Choquette-Choo et al., 2025) and communication-efficient high-dimensional private aggregation (Asi et al., 2026), where it was shown to have utility advantages over the standard Poisson sampling. Theoretical analyses of this sampling scheme (Feldman & Shenfeld, 2025; Dong et al., 2025) lead to bounds that are close to those of Poisson sampling, yet still have two significant shortcomings. First, in many practical settings, the resulting privacy parameters are not tight due to the approximation steps in the analysis. Second, the computed parameters are either the hockey stick or Renyi divergence, both of which introduce overheads when used in privacy loss accounting. In this work, we demonstrate that the privacy loss distribution (PLD) of random allocation applied to any differentially private algorithm can be computed efficiently. When applied to the Gaussian mechanism, our results demonstrate that the privacy-utility trade-off for random allocation is at least as good as that of Poisson subsampling. In particular, random allocation is better suited for training via DP-SGD. To support these computations, our work develops new tools for general privacy loss accounting based on a notion of PLD realization. This notion allows us to extend accurate privacy loss accounting to subsampling which previously required manual noise-mechanism-specific analysis.

The pandemic in 2020 and 2021 had enormous economic and societal consequences, and studies show that contact tracing algorithms can be key in the early containment of the virus. While large strides have been made towards more effective contact tracing algorithms, we argue that privacy concerns currently hold deployment back. The essence of a contact tracing algorithm constitutes the communication of a risk score. Yet, it is precisely the communication and release of this score to a user that an adversary can leverage to gauge the private health status of an individual. We pinpoint a realistic attack scenario and propose a contact tracing algorithm with differential privacy guarantees against this attack. The algorithm is tested on the two most widely used agent-based COVID19 simulators and demonstrates superior performance in a wide range of settings. Especially for realistic test scenarios and while releasing each risk score with epsilon=1 differential privacy, we achieve a two to ten-fold reduction in the infection rate of the virus. To the best of our knowledge, this presents the first contact tracing algorithm with differential privacy guarantees when revealing risk scores for COVID19.

In human-centric Cyber-Physical Systems (CPS), personalized Deep Reinforcement Learning (DRL) agents must share fine-grained control actions with cloud services, exposing sensitive private states to inference attacks by honest-but-curious adversaries. Static privacy models fail to address the dynamic nature of human interactions. This paper introduces PEARL (Personalized Early-exit Adaptive Reinforcement Learning), a novel framework that addresses this challenge through structural privacy control rather than data perturbation. PEARL deploys a dual-path Early-Exit Deep Q-Network (EE-DQN) at the edge, using Mutual Information (MI) between private states and observable actions to train per-branch binary labels: Utility Confidence Labels (UCL), verifying action quality, and Privacy Confidence Labels (PCL), verifying MI leakage remains below a user-defined threshold. At inference, PEARL selects the shallowest exit branch satisfying both UCL and PCL, structurally limiting shared action descriptive power without noise injection. An MI-based feedback loop tracks behavioral drift and triggers retraining when privacy-utility profiles shift, ensuring long-term robustness. Validated on a personalized smart-home HVAC system and a VR smart classroom, PEARL reduces adversarial state-inference accuracy by 25.67% on average with a controlled 10-16% utility cost, establishing a practical, dynamically enforceable privacy-utility tradeoff.

The integration of Large Language Models into daily tasks relies on context-rich instructions, inevitably exposing sensitive user information. Current privacy-preserving methods typically employ context-agnostic static rules, causing severe utility degradation. However, the specific mechanisms governing how sanitization impacts downstream performance remain largely underexplored. To address this, we conduct a systematic analysis to deconstruct the privacy-utility trade-off, uncovering three underlying mechanisms: (1) Context-Dependent Utility, which first establishes when to sanitize by revealing that data value shifts from critical constraints to dispensable noise based on user intent; (2) Strategic Adaptation, which subsequently determines how to sanitize by dictating that the choice between removal and replacement depends on the task's reliance on factual integrity versus structural coherence; and (3) Combinatorial Interplay, which finally extends the protection scope by demonstrating that attributes form a semantic web of synergistic dependencies or antagonistic redundancies. Guided by these insights, we introduce an intent-driven local protection framework. By distilling a lightweight model Veilmind-4B to drive a dynamic extraction-sanitization-restoration pipeline, our approach reaches a low-leakage privacy point while preserving substantially higher response utility than existing privacy-oriented baselines, advancing the privacy-utility trade-off toward the Pareto frontier.