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Experimentally Elicited Beliefs Explain Privacy Behavior

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  • David RivenbarK

    () (University of Central Florida, Orlando, FL)

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    Abstract

    The privacy literature has recognized a dichotomy between reported values of privacy and actual behavior. People tend to say they value privacy highly, and then behave in ways which seem to contradict these statements. In this experiment, the consequences of privacy loss were controlled using a voluntary contributions mechanism that isolated personal information from the natural world. Elicited values were higher than what has typically been observed in the literature. The evidence does not support a “privacy paradox.” Subjective expected utility maximization explains the dichotomy. Trust and asymmetric beliefs are substantial determinants of (information) values.

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    File URL: http://files.bus.ucf.edu/cdn/economics/workingpapers/2010-09.pdf
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    Bibliographic Info

    Paper provided by University of Central Florida, Department of Economics in its series Working Papers with number 2010-09.

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    Length: 33 Pages
    Date of creation: Sep 2010
    Date of revision: Feb 2011
    Handle: RePEc:cfl:wpaper:2010-09

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    Related research

    Keywords: elicitation; expected utility; privacy; privacy paradox; subjective beliefs;

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    1. Hoffman Elizabeth & McCabe Kevin & Shachat Keith & Smith Vernon, 1994. "Preferences, Property Rights, and Anonymity in Bargaining Games," Games and Economic Behavior, Elsevier, vol. 7(3), pages 346-380, November.
    2. Isaac, R Mark & Walker, James M, 1988. "Group Size Effects in Public Goods Provision: The Voluntary Contributions Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 103(1), pages 179-99, February.
    3. Hey, John D & Orme, Chris, 1994. "Investigating Generalizations of Expected Utility Theory Using Experimental Data," Econometrica, Econometric Society, vol. 62(6), pages 1291-1326, November.
    4. Wilcox, Nathaniel T., 2011. "'Stochastically more risk averse:' A contextual theory of stochastic discrete choice under risk," Journal of Econometrics, Elsevier, vol. 162(1), pages 89-104, May.
    5. Isaac, R. Mark & McCue, Kenneth F. & Plott, Charles R., . "Public Goods Provision in an Experimental Environment," Working Papers 428, California Institute of Technology, Division of the Humanities and Social Sciences.
    6. Charles A. Holt & Susan K. Laury, 2002. "Risk Aversion and Incentive Effects," American Economic Review, American Economic Association, vol. 92(5), pages 1644-1655, December.
    7. Heath, Chip & Tversky, Amos, 1991. " Preference and Belief: Ambiguity and Competence in Choice under Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 4(1), pages 5-28, January.
    8. Yan Chen & Sherry Xin Li, 2009. "Group Identity and Social Preferences," American Economic Review, American Economic Association, vol. 99(1), pages 431-57, March.
    9. Helen Bernhard & Ernst Fehr & Urs Fischbacher, 2006. "Group Affiliation and Altruistic Norm Enforcement," American Economic Review, American Economic Association, vol. 96(2), pages 217-221, May.
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