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The lack of consumer confidence in information privacy has been identified as a major problem hampering the growth of e-commerce. Despite the importance of understanding the nature of online consumers' concerns for information privacy, this topic has received little attention in the information systems community. To fill the gap in the literature, this article focuses on three distinct, yet closely related, issues. First, drawing on social contract theory, we offer a theoretical framework on the dimensionality of Internet users' information privacy concerns (IUIPC). Second, we attempt to operationalize the multidimensional notion of IUIPC using a second-order construct, and we develop a scale for it. Third, we propose and test a causal model on the relationship between IUIPC and behavioral intention toward releasing personal information at the request of a marketer. We conducted two separate field surveys and collected data from 742 household respondents in one-on-one, face-to-face interviews. The results of this study indicate that the second-order IUIPC factor, which consists of three first-order dimensions-namely, collection, control, and awareness-exhibited desirable psychometric properties in the context of online privacy. In addition, we found that the causal model centering on IUIPC fits the data satisfactorily and explains a large amount of variance in behavioral intention, suggesting that the proposed model will serve as a useful tool for analyzing online consumers' reactions to various privacy threats on the Internet.
Key words: information privacy; concerns for information privacy; Internet users' information privacy concerns; structural equation modeling; nomological network; causal model
History: Detmar Straub, Associate Editor. This paper was received on June 25, 2003, and was with the authors 5 months for 3 revisions.
1. Introduction
Despite the enormous potential of e-commerce, its share of the total economy remains small: less than 1% worldwide (U.S. Department of Commerce 2002). The lack of consumer confidence in online privacy has been identified as a major problem hampering the growth of e-commerce. Norman Mineta (2000), former U.S. Secretary of Commerce, remarked that the U.S. government regarded privacy as one of the most critical issues in the continued growth of the economy. In addition, a report showed that practically all Americans (94.5%), including Internet users and non-Internet users, are concerned about "the privacy of their personal information when or if they buy online"...