Navigating privacy concerns through societal benefits: A case of digital contact tracing applications

Abstract Digital contact tracing (DCT) applications, as a type of location‐based application, have been employed in many countries to help mitigate the spread of the COVID‐19 virus. However, the emergence of DCTs has amplified concerns over privacy issues as consumers are confronted with the ethical dilemma that arises regarding serving public and private interests. In other words, to what extent are consumers willing to negotiate their privacy concerns to gain perceived social benefits? Drawing on Social Exchange Theory as the theoretical lens to examine interpersonal relations between the government and consumers, this study investigates the extent to which consumers' perceived social benefits (e.g., reciprocity, trust, and reputation) mediate the relationship between privacy concerns and the intention to use DCT applications. Based on 269 usable responses, the results revealed that government trust was insignificant in mediating the relationship between privacy concerns and intention to use the DCT application. Rather, the expected reciprocal benefits and reputation enhancement were found to have significant mediating effects. Perceived government regulation was also found to moderate the relationship between privacy concerns and government trust. The paper concludes with suggestions for practitioners and policymakers on the plausible strategies to encourage the adoption of DCT applications.