Relative Privacy Valuations Under Varying Disclosure Characteristics

We investigate changes to the value that individuals place on the online disclosure of their private information in the presence of multiple privacy factors. We use an incentive-compatible mechanism to capture individuals’ willingness-to-accept (WTA) for a privacy disclosure in a series of three randomized experiments. Each experiment manipulates characteristics of a required privacy disclosure by altering the information context, the intended secondary use of the disclosed private information, and the requirement to disclose personally identifying information. We collect data from two populations (college students and Amazon Mechanical Turk workers) to aid with generalizability of our results. As methodological checks to rule out lack of awareness in the participants, we first increase the saliency of the privacy disclosure characteristics in the second experiment and then require participants to watch a video on the potential consequences of disclosing private information in the third experiment. Across the three experiments, we consistently observe null effects for each of the privacy factors, with two population-dependent exceptions in the second study. Our participants do acknowledge the increased risk introduced by the experimental factors, and the increased saliency and awareness do lead to higher privacy valuations on average. However, there is no consistent manifestation as significant main effects for the three privacy factors. This is in contrast to prior research, which has found significant effects for each of these factors when studied separately. The results provide a unique perspective on privacy valuations by showing that results from prior research on simple privacy decisions may not translate to more realistic, complex privacy disclosure decisions that involve multiple factors. The online appendix is available at https://doi.org/10.1287/isre.2018.0818 .