Abstract

Do unsophisticated consumers fall prey to Internet consumer frauds? Why? To answer these questions this paper integrates two streams of empirical research: the process-oriented theory of deception, and the broader deception, trust, and risk (DTR) model of Internet consumer behavior. A laboratory experiment tests several alternative hypotheses about the determinants of failure at detecting Internet deceptions. The findings suggest that Internet consumers process the clues that a site may be deceptive, but are unable to effectively evaluate and combine these clues, i.e., to draw correct conclusions from them. This is good news in the ongoing struggle against Internet fraud because it suggests that consumers lack the knowledge, not the capacity, to detect decep- tions and that consumer education programs might be effective in helping consumers to protect themselves.

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