The Effects of Notice versus Awareness: an Empirical Examination of an Online Consumer's Privacy Risk Treatment

Notice of an entity's personal information collection and usage practices is considered to be a prerequisite to an online user being able to make informed decisions on personal information disclosure. Notice is typically provided in privacy policies that are often characterized as vague, lengthy, and misleading. As such, notice typically does not equate to awareness of privacy threats. This study evaluates the effects of notice and threat awareness on an online user's decision to treat risk through mitigation, avoidance, or acceptance. Study findings indicate opposite effects of notice versus threat awareness on risk treatment. Whereas notice had a positive effect on acceptance, threat awareness had a negative effect on acceptance and a positive effect on avoidance. Thus, notice appears to invoke a false sense of assurance that encourages online users to adopt acceptance as a risk treatment, while awareness of privacy threats discourages online users from passive acceptance.