UNDERSTANDING PRIVACY PARADOX: AN EXPERIMENTAL APPROACH TO STUDY PRIVACY CONCERNS AND ACTUAL DISCLOSURE AMONG APP USERS

ABSTRACT

Consumers increasingly protest invasions of privacy by digital applications and platforms, yet they habitually reveal more information than their disclosure intent. This paradoxical behavior has been explained using rational and irrational reasons (cognitive biases and heuristics), but they have been essentially conjectural. Thus, in this research, we empirically verify the existence of the privacy paradox and test four such reasons using quasi-experiments: privacy calculus as a rational explanation, information asymmetry as part of bounded rationality, bandwagon effect as a cognitive bias, and trust as a decision-making heuristic. A dummy app was developed to collect data from 594 mobile application users. The existence of the privacy paradox was tested using regression between privacy concern and actual disclosure. Following this, the reasons for the privacy paradox were tested using ANOVA. We concluded that privacy paradox exists in the defined sample, and the two reasons that explain the privacy paradox are information asymmetry and the peanut effect.

KEYWORDS:

• Privacy paradox
• app users
• cognitive bias
• heuristics
• actual disclosure

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Sakhhi Chhabra

Sakhhi Chhabra is an Assistant professor for Marketing at XLRI Delhi NCR. She is a PhD from MDI- Gurgaon and MSc. Marketing from Manchester Business School, UK. She has been teaching core and elective marketing subjects to post graduate students and executives at prestigious MBA institutes. She has successfully published research papers, case studies and book chapters in renowned International and National Journals. She has presented her research work at various reputed conferences in India and abroad.

Jaydeep Mukherjee

Dr. Jaydeep Mukherjee is a marketing professor at MDI Gurgaon. He blends latest academic research and industry experience to provide fresh perspective and insights to marketing problems. He had worked in industry for nine years from 1992-2001, before joining XIM Bhubaneswar as a faculty. He offers elective courses in Sales and Distribution, Business to Business Marketing, Product Management, Marketing Strategy, and Marketing for Virtual World.

Madhushree N Agarwal

Madhushree N Agarwal is an Organizational Behavior professor at MDI-Gurgaon. She is a Fellow of IIM Calcutta with a major in Organizational Behaviour and minor in Strategic Management. She has five years of industry experience in the Indian IT industry and 18 years of teaching and research experience in areas of her academic interest, which include Organizational Design, Cross-Cultural Management, Creativity and Innovation, Entrepreneurship, and Management of Non-Profit Organizations.