Is privacy compatible with truthfulness?

In the area of privacy-preserving data mining, a differentially private mechanism intuitively encourages people to share their data because they are at little risk of revealing their own information. However, we argue that this interpretation is incomplete because external incentives are necessary for people to participate in databases, and so data release mechanisms should not only be differentially private but also compatible with incentives, otherwise the data collected may be false. We apply the notion of truthfulness from game theory to this problem. In certain settings, it turns out that existing differentially private mechanisms do not encourage participants to report their information truthfully.