TY - JOUR
T1 - Privacy please: Power distance and people’s responses to data breaches across countries
AU - Madan, Shilpa
AU - Savani, Krishna
AU - Katsikeas, Constantine S.
N1 - Funding Information:
This research was supported by a Security, Privacy, and Trust Pillar Grant awarded by Pamplin College of Business to Shilpa Madan and a Nanyang Assistant Professorship grant awarded by Nanyang Technological University to Krishna Savani. We would like to thank Andrea Low, Tara Hackett, Dayana Bulchand, and Sylvia Chin for invaluable assistance with this research. We would also like to thank the participants at the Association for Consumer Research 2019 conference for their feedback.
Publisher Copyright:
© 2022, Academy of International Business.
PY - 2022/5/19
Y1 - 2022/5/19
N2 - Information security and data breaches are perhaps the biggest challenges that global businesses face in the digital economy. Although data breaches can cause significant harm to users, businesses, and society, there is significant individual and national variation in people’s responses to data breaches across markets. This research investigates power distance as an antecedent of people’s divergent reactions to data breaches. Eight studies using archival, correlational, and experimental methods find that high power distance makes users more willing to continue patronizing a business after a data breach (Studies 1–3). This is because they are more likely to believe that the business, not they themselves, owns the compromised data (Studies 4–5A) and, hence, do not reduce their transactions with the business. Making people believe that they (not the business) own the shared data attenuates this effect (Study 5B). Study 6 provides additional evidence for the underlying mechanism. Finally, Study 7 shows that high uncertainty avoidance acts as a moderator that mitigates the effect of power distance on willingness to continue patronizing a business after a data breach. Theoretical contributions to the international business literature and practitioner and policy insights are discussed.
AB - Information security and data breaches are perhaps the biggest challenges that global businesses face in the digital economy. Although data breaches can cause significant harm to users, businesses, and society, there is significant individual and national variation in people’s responses to data breaches across markets. This research investigates power distance as an antecedent of people’s divergent reactions to data breaches. Eight studies using archival, correlational, and experimental methods find that high power distance makes users more willing to continue patronizing a business after a data breach (Studies 1–3). This is because they are more likely to believe that the business, not they themselves, owns the compromised data (Studies 4–5A) and, hence, do not reduce their transactions with the business. Making people believe that they (not the business) own the shared data attenuates this effect (Study 5B). Study 6 provides additional evidence for the underlying mechanism. Finally, Study 7 shows that high uncertainty avoidance acts as a moderator that mitigates the effect of power distance on willingness to continue patronizing a business after a data breach. Theoretical contributions to the international business literature and practitioner and policy insights are discussed.
KW - data breach
KW - experiments
KW - ownership
KW - power distance
KW - privacy
KW - uncertainty avoidance
UR - http://www.scopus.com/inward/record.url?scp=85130298105&partnerID=8YFLogxK
U2 - 10.1057/s41267-022-00519-5
DO - 10.1057/s41267-022-00519-5
M3 - Journal article
SN - 1478-6990
JO - Journal of International Business Studies
JF - Journal of International Business Studies
ER -