Estimating the monetary value of personal information on social networking sites

The dramatic growth of social networking service (SNS) has been accompanied by increasing privacy concerns. While many firms have attempted to collect personal information from SNS users even by paying for it, there has been a lack of understanding about the valuation of personal information on SNS. This study therefore estimates the monetary value of SNS privacy. We first use the contingent valuation method (CVM) to estimate the willingness-to-accept (WTA) value of SNS privacy as a nonrival good. Using data from 293 SNS users, the results show the average WTA value of SNS privacy is US$27.83: The privacy monetary value that each SNS user thinks is $27.83. The results further demonstrate that SNS users estimate their privacy value differently depending on sociodemographic information (e.g., age, gender, education level, and monthly expenditure) and SNS features (e.g., type of SNS platform and purpose of SNS use). This study contributes to the literature by estimating the monetary value of SNS privacy and providing practical implications for the administration of SNS privacy. Furthermore, our research extends the horizon of privacy studies by combining privacy literature in information systems with the CVM in economics.