Unpacking the privacy paradox of consumers: A psychological perspective

This study explicates why consumers allow the unconditional collection and processing of personal data while doubting data privacy. A process model addressing this privacy paradox is consequently designed through multidisciplinary research. Altogether, two online studies concur that certain factors may mitigate the negative effect of risk perception concerning data privacy during the personal data disclosure process. Hence, we examine the impact of the privacy paradox based on the literature on mental accounting, which describes interactions between present and future costs and benefits. In this context, consumer behavior is deciphered via analysis of four key variables, namely, the mental accounting of privacy-related risks, consumer involvement, type of perceived benefit regarding the specific purchase/transaction, and consumer familiarity.