Privacy Regulations and Online Search Friction: Evidence from GDPR

64 Pages Posted: 13 Aug 2021

See all articles by Yu Zhao

Yu Zhao

University of Pennsylvania - The Wharton School

Pinar Yildirim

University of Pennsylvania - The Wharton School

Pradeep K. Chintagunta

University of Chicago

Date Written: August 12, 2021

Abstract

How do privacy regulations in the market impact online search for products and information? This paper investigates the impact of the General Data Protection Regulation (GDPR for short) on consumers’ online browsing and search behavior using consumer panels from four countries, United Kingdom, Spain, United States, and Brazil. We find that after GDPR, a panelist exposed to GDPR submits 21.6% more search terms to access information and browses 16.3% more pages to access consumer goods and services compared to a non-exposed panelist, indicating higher friction in online search. The implications of increased friction are heterogeneous across firms: Bigger e-commerce firms see an increase in consumer traffic and more online transactions. The increase in the number of transactions at large websites is about 6 times the increase experienced by smaller firms. Overall, the post-GDPR online environment may be less competitive for online retailers and may be more difficult for EU consumers to navigate through.

Keywords: privacy, GDPR, consumer search

Suggested Citation

Zhao, Yu and Yildirim, Pinar and Chintagunta, Pradeep K., Privacy Regulations and Online Search Friction: Evidence from GDPR (August 12, 2021). Available at SSRN: https://ssrn.com/abstract=3903599 or http://dx.doi.org/10.2139/ssrn.3903599

Yu Zhao

University of Pennsylvania - The Wharton School ( email )

700 Jon M. Huntsman Hall
3730 Walnut Street
Philadelphia, PA 19104-6340
United States

Pinar Yildirim (Contact Author)

University of Pennsylvania - The Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

Pradeep K. Chintagunta

University of Chicago ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773-702-8015 (Phone)
773-702-0458 (Fax)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
63
Abstract Views
298
rank
429,177
PlumX Metrics