Too Tired and in Too Good of a Mood to Worry About Privacy: Explaining the Privacy Paradox Through the Lens of Effort Level in Information Processing

Policy-oriented Abstract Data privacy is one of the most pressing issues today. The world is thirsty for novel, effective, and efficient policies to strike an appropriate balance between protecting individuals’ privacy and creating economic value from their personal information. Whereas governmental efforts, such as the enaction of General Data Protection Regulation, California Consumer Privacy Act, and other privacy regulations, have been pushing boundaries to strike this balance, the effects of these types of initiatives on individuals’ privacy awareness and behavior are uncertain, likely to be nuanced, and will take time to sort out. In this paper, we explain the privacy paradox, a phenomenon with important implications that apply to policymakers, industry professionals, and individuals. The privacy paradox refers to a mismatch between individuals’ stated privacy concerns and their actual disclosure behaviors. In three behavioral experiments, we show how the paradox is revealed when individuals are cognitively tired especially when they are in a good mood. These findings do not indicate that individuals do not care about privacy because they do when they are not cognitively tired especially when they are in a bad mood. By explaining the privacy paradox, we inform existing and future privacy policies to strike that balance we all strive for.