Privacy risk is defined as the probability of having personal information disclosed as a result of online transactions [Garbarino and Strahilevitz 2004; Maignan and Lukas 1997]. Despite the growing online sales volume, concerns regarding privacy remain high among many online shoppers [e.g., Drennan et al. 2006; Miyazaki and Fernandez 2001; Noort et al. 2008]. Chapell [2005] finds that more than 69 percent of US Internet shoppers limit their online purchases because of concerns related to the privacy and safety of their personal information. However, Forsythe and Shi [2003] find that although privacy concern was a frequently cited reason for not purchasing online, it does not significantly impact the frequency of purchasing online and searching with intent to buy. Thus, the effect of perceived privacy risk on purchase intention remains rather unclear. In this study, we postulate that online shoppers’ perception of privacy risk will deter them from shopping online:
H3: Privacy risk is negatively associated with online shopping intentions.