The Effect of Online Privacy Information on Purchasing Behavior: An Experimental Study

Information Systems Research, 22(2), 254-268

38 Pages Posted: 6 Jan 2019 Last revised: 10 Jan 2019

See all articles by Janice Tsai

Janice Tsai

Carnegie Mellon University

Serge Egelman

International Computer Science Institute (ICSI); University of California, Berkeley - Department of Electrical Engineering & Computer Sciences (EECS)

Lorrie Faith Cranor

Carnegie Mellon University - School of Computer Science and Carnegie Institute of Technology

Alessandro Acquisti

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management

Date Written: 2011

Abstract

Although online retailers detail their privacy practices in online privacy policies, this information often remains invisible to consumers, who seldom make the effort to read and understand those policies. This paper reports on research undertaken to determine whether a more prominent display of privacy information will cause consumers to incorporate privacy considerations into their online purchasing decisions. We designed an experiment in which a shopping search engine interface clearly and compactly displays privacy policy information. When such information is made available, consumers tend to purchase from online retailers who better protect their privacy. In fact, our study indicates that when privacy information is made more salient and accessible, some consumers are willing to pay a premium to purchase from privacy protective websites. This result suggests that businesses may be able to leverage privacy protection.

Keywords: privacy, information systems, economics, experimental economics

Suggested Citation

Tsai, Janice and Egelman, Serge and Cranor, Lorrie Faith and Acquisti, Alessandro, The Effect of Online Privacy Information on Purchasing Behavior: An Experimental Study (2011). Information Systems Research, 22(2), 254-268, Available at SSRN: https://ssrn.com/abstract=3305347

Janice Tsai

Carnegie Mellon University ( email )

Pittsburgh, PA 15213-3890
United States

Serge Egelman

International Computer Science Institute (ICSI) ( email )

Berkeley, CA
United States

University of California, Berkeley - Department of Electrical Engineering & Computer Sciences (EECS) ( email )

Berkeley, CA 94720-1712
United States

Lorrie Faith Cranor

Carnegie Mellon University - School of Computer Science and Carnegie Institute of Technology ( email )

5000 Forbes Avenue
Pittsburgh, PA 15213
United States

Alessandro Acquisti (Contact Author)

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management ( email )

Pittsburgh, PA 15213-3890
United States
412-268-9853 (Phone)
412-268-5339 (Fax)

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