Consumer choice, personal data and privacy in the smartphone age

The main outcome of the project is the PhD thesis "Four Papers on Privacy and Human Behavior". The thesis examines the decision-making process and preferences relating to digital privacy. The four articles investigate questions such as: How do we make decisions when sharing our data with a third party, commercial or public? Do we really care about privacy, or are we indifferent? When are we willing to trade our personal data for a benefit? The first paper studies privacy from a customer perspective through a two-wave survey conducted in 2017 and 2018 among young Norwegians. We assess their awareness of digital privacy, measured by levels of concern about and knowledge of privacy. We then looked at how this awareness affected privacy behavior. In spring 2018, the introduction of the EU’s new General Data Protection Regulation (GDPR) and what became known as the “Cambridge Analytica scandal” received a lot of media attention. Our analysis revealed a significant increase in privacy knowledge during this period, while the level of concern was high. Many take active steps to protect their data, and this is correlated with high concern and knowledge. In the second paper, we investigate the willingness of young mobile users in Malaysia, Norway, Pakistan, and Serbia to share personal data in return for receiving personalized ads on their cell phones. We test whether the likelihood of using such an ad service varies with the level of personal data collected and whether data are shared with third parties. The likelihood decreases when the service uses more personal data. Further, we find that, in three of the four countries, giving a 10\% discount on cell phone subscriptions for using the ad service increases the stated likelihood of using the service. Respondents in Norway were least willing, while those in Pakistan were most willing to share personal data. The third paper examines people’s attitudes to sharing personal data when the data are used to help society combat a serious contagious disease. Through a two-wave survey, in 2020, conducted in Norway and Sweden, we investigate the role of personal characteristics, and the effect of information, in shaping attitudes to privacy. We find that privacy concern is negatively correlated with allowing public use of personal data. Trust in the entity collecting the data and collectivist preferences are positively correlated with this type of data usage. Providing more information about the health benefit of sharing personal data makes respondents more positive, while providing additional information about the privacy costs does not change attitudes. Stating a clear purpose for the data collection makes respondents more positive about sharing. In a comparison across survey waves and countries, we find that our results are robust across contexts and policy choices. In the fourth paper we present new insights into the relationship between hedonic well-being, privacy decisions, and information avoidance. We investigate the tendency of individuals to avoid privacy information when they are exposed to entertaining online content. Consuming such content can lead to high levels of hedonic well-being, making it more likely that privacy information could have a negative effect. In an online experiment, we show participants online, and they must either seek out or avoid information about privacy. The entertainment value of the videos and the indicated time cost of obtaining the privacy information are varied. We found that the entertainment value of the videos and the time cost had weak negative effects on information seeking. Our findings also indicate that participants who were exposed to entertaining content anticipated a more negative impact of privacy information on their user experience. This thesis contributes with new insights into privacy, human behavior and the sharing of personal data in digital everyday life. The survey data are collected in countries that vary greatly in terms of both their technological and economic development, and in relation to attitudes to privacy and its status in law. Despite these differences, similarities are evident across the different contexts in the four articles. Firstly, we see that many respondents are concerned about their privacy when online. Furthermore, high levels of concern are accompanied by lower willingness to share data, while the opposite is the case for trust in the actor who collects the data. The findings pave the way for more research on privacy and human behavior.

Prosjektet har bidratt til en økt forståelse av individers personvernadferd, og hva som påvirker denne adferden. Hva gjøre at en bruker av en tjeneste er villig til å dele sin personlige data? Kunnskapen går på tvers av kontekst, om det er private eller offentlige aktører som utnytter personlige data, og på tvers av land. Spesielt er forskning på personvern utenfor den vestlige verden foreløpig begrenset, og prosjektet bidrar i denne dimensjonen. Dette er kunnskap som vil kunne anvendes både av næringsaktører og regulerende myndigheter. Aktører som benytter personlige data til å utvikle en tjeneste vil ofte måtte håndtere balansen mellom å levere en god tilpasset tjeneste og individene som blir bedt om å dele sin data sitt behov for personvern. For å håndtere denne avviingen må en forstå brukeres preferenser og hva som driver deres adferd

The project "Consumer choice, personal data and privacy in the smartphone age" will bring new insight on the economics of privacy, with the main research question “What factors affect consumers’ choice, when personal data is a part of the payment?” as a starting point. With the introduction of Internet, smartphones, users leave large amounts of digital traces and personal information as they use the online services. The role of personal data in business is at the rise and digital privacy is becoming a complex topic. For the consumers, it is difficult to understand what data are collected, when, by whom and for what purposes. Keeping track of personal digital information is a challenge even for the most conscious and advanced users. In general, the awareness of digital privacy is at the rise especially in developed economies, and new regulations, like the General Data Protection Regulation in the EU are developed, to meet the new privacy challenges in the digital domain. Even though privacy awareness in general is going up, there are still large differences among consumer on how they relate to digital privacy. These differences go across privacy concern, knowledge and to what degree they take actions to protect their data. Understanding how consumer preferences and choices are formed by this development is crucial for commercial actors with ambitions use personal data in their business, and it will be at the centre of the suggested research project. Examples of possible research questions for papers: - Is there a “Cambridge Analytica” effect with regard to privacy concern in Norway? - To what degree do different levels of knowledge explain consumer choice with respect to digital privacy? - Would it be fair if a services provider that provides a service for a price, uses personal data the same way as a service provider that gives away a service “for free”? - Would differences in knowledge regarding privacy lead to differences in consumer choice?