A market for digital privacy: consumers' willingness to trade personal data and money

This paper analyzes the trade-off consumers face between monetary benefits and personal data disclosure. We use survey data from Norway to study respondents’ willingness to share data in exchange for a discount (WSD) and to pay to keep data private (WPP) for a list of personal data often exchanged online. Additionally, we study the effects of various consumer demographics and attitudes on WPP and WSD. We find that WSD and WPP change for different personal data. WPP is lower than WSD for low-sensitivity data, such as age. WSD increases when the data are used for personalization and when users interact with institutions they trust. WPP is higher than WSD for data personally identifying a respondent, such as pictures. Providing paid privacy protection for these data is a valuable service. Financial institutions and mobile operators are better positioned than others to offer this service. Younger respondents show a higher WPP.