Given the ever-increasing volume of online services, it has become impractical for Internet users to study every company’s handling of information privacy separately and in detail. This challenges a central assumption held by most information privacy research to date—that users engage in deliberate information processing when forming their privacy-related beliefs about online services. In this research, we complement previous studies that emphasize the role of mental shortcuts when individuals assess how a service will handle their personal information. We investigate how a particular mental shortcut—users’ stereotypical thinking about providers’ handling of user information—can cause systematic judgment errors when individuals form their beliefs about an online service. In addition, we explore the effectiveness of counter-stereotypic privacy statements in preventing such judgment errors. Drawing on data collected at two points in time from a representative sample of smartphone users, we studied systematic errors caused by stereotypical thinking in the context of a mobile news app. We found evidence for stereotype-induced errors in users’ judgments regarding this provider, despite the presence of counter-stereotypic privacy statements. Our results further suggest that the tone of these statements makes a significant difference in mitigating the judgment errors caused by stereotypical thinking. Our findings contribute to emerging knowledge about the role of cognitive biases and systematic errors in the context of information privacy
