The Behavioral Economics of Social Media: A Study of Self Commitment Devices and the Facebook Privacy Paradox

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Abstract/Contents

Abstract: Despite mounting public concern over the issue of social media overusage, there is limited evidence that the time individuals spend on social media platforms is excessive from a welfare standpoint. I implement a randomised intervention over 6 weeks, encouraging a subset of 629 participants recruited over Facebook to adopt a voluntary soft commitment device designed to help limit their phone, Facebook, and Instagram usage. Utilising data from 4 surveys and direct measurement of social media use, I find that: (i) individuals persistently underestimate how much time they actually spend on social media; (ii) they spend much more time on their phones and Facebook than they profess to ideally desire; (iii) users are willing to set application limits even in the absence of incentives to do so; (iv) and lastly, the adoption of such limits significantly reduces phone and Facebook use, with reductions in the latter persisting even after a month. These results all suggest that individuals spend more time on social media than is optimal as a result of their limited ability to exercise self-control. Additionally, in a second experimental arm of the study, I investigate the effect of nudging individuals to review and report their Facebook privacy settings on their behaviour, finding that it results in limited changes to privacy-protective choices; instead, I find that individuals respond by reducing their usage of Facebook.

Type of resource	text
Date created	May 25, 2019

Author	Hoong, Ruru (Juan Ru)
Primary advisor	Gentzkow, Matthew
Degree granting institution	Stanford University, Department of Economics

Related item	Title 2019 Firestone Medal for Excellence in Undergraduate Research
Location	https://purl.stanford.edu/qt999vz1100

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License: This work is licensed under a Creative Commons Attribution Non Commercial 3.0 Unported license (CC BY-NC).

Preferred Citation: Hoong, Ruru. (2019). The Behavioral Economics of Social Media: A Study of Self Commitment Devices and the Facebook Privacy Paradox. Stanford Digital Repository. Available at: https://purl.stanford.edu/qt999vz1100

Stanford University, Department of Economics, Honors Theses

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