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In a world with unlimited potential for gathering, storing, processing, disseminating, and exploiting personal information, consumers are inevitably concerned about their privacy, and some are losing hope altogether. A new survey revealed that the percentage of adults who agree with the statement “online privacy is possible” have dropped substantially from 61% in 2018 to 32% in 2019 (Sterling, 2019). The survey also reported that the recent privacy scandals led 78% of the respondents to modify their online behavior, with 74% of them reporting sharing less information online. Those who have not changed their behavior, for the most part, either had accepted a lack of privacy when engaging online or were already highly protective of their information.
Extensive research on information privacy concerns has concluded that a substantial segment of the society will resist certain online transactions or technologies, thereby limiting the growth of the digital economy, due to significant and growing privacy concerns (Adjerid, Peer, & Acquisti, 2018; Angst & Agarwal, 2009; Bansal, Zahedi, & Gefen, 2010; Buckman, Bockstedt, & Hashim, 2019; Dinev et al., 2006; Dinev, Hart, & Mullen, 2008; Malhotra, Kim, & Agarwal, 2004; Son & Kim, 2008; H. Xu, Teo, Tan, & Agarwal, 2012). A variety of surveys and experiments have also shown that privacy concerns impede electronic commerce (Buckman et al., 2019; Hoffman, Novak, & Peralta, 1999; International, 2005; Smith, Milberg, & Burke, 1996; Tang, Hu, & Smith, 2008; Westin, 2004) and undermine the trust between businesses and consumers (Hoffman et al., 1999; Tang et al., 2008).
The global nature of the Internet and e-commerce is making privacy issues even more complex because the perceptions of privacy, trust in online companies, risk of disclosing information online, and fair information practices vary across cultures (Bellman, Johnson, Kobrin, & Lohse, 2004; Cao & Everard, 2008; Dinev et al., 2006; Milberg, Burke, Smith, & Kallman, 1995; Milberg, Smith, & Burke, 2000). For example, “in Europe, privacy is viewed as a ‘human rights’ issue; in the U.S., it is more often seen as a matter for contractual negotiation” (Smith, 2001, p.13). The European Union’s General Data Protection Regulation (GDPR) that went into effect in May of 2018 further illustrates this (Greengard, 2018). In 1964 India’s supreme court acknowledged the right of privacy as implicit in their constitution although India lacks regulation similar to GDPR (Basu, 2010). In the United States, privacy can be exchanged for personalized services or other benefits, and such differences in practice greatly affect how privacy is perceived by individuals and regulated by governments (Smith, 2001; Tang et al., 2008). Additionally, differences in cultural values have become important as the Internet has enabled massive amounts of consumer data to be transferred instantly across national borders (Nijhawan, 2003). Therefore, understanding and addressing the variations in trust and privacy perceptions across various cultures has become imperative for global corporate managers (Dinev et al., 2006).
While the Internet greatly facilitates the flow of information about consumers, differences in national regulation create challenges for global information management strategies, sometimes limiting or even preventing the free flow of valuable information (Fjetland, 2002). Governments around the world have struggled with regulating issues associated with information privacy, and their approaches have differed greatly (Flaherty, 1989; Milberg et al., 2000; Smith, 2001). A common thread in press reports is that varying regulatory approaches to cross-border data flows are causing great consternation among firms that compete internationally (Kanter, 2014; Miltgen & Smith, 2015; Singer, 2013). Thus, careful consideration of variations in national regulations of information privacy is another imperative for today’s corporate managers.