Labeled as the privacy calculus model, research assumes that individuals perform a rational tradeoff between benefits and privacy risks. However, growing evidence indicates that due to incomplete information and bounded rationality, individuals’ decision making is biased. De-rived from behavioral economics literature, overconfidence is one of the most critical bias in decision-making and has drawn little attention in privacy research. Based on an empirical online study among 239 smartphone users, we (1) measure actual privacy knowledge with the help of a quiz and thus provide evidence that overconfidence with regard to privacy exists, as well as (2) show that overconfidence moderates the link between privacy risks and the behav-ioral intention to use a smartphone application. Additionally, (3) we found the presence of the Dunning-Kruger-effect in our sample with less competent individuals being more overconfident than high performers. Overall, by building on the behavioral economics literature and incorpo-rating a cognitive bias into the privacy calculus model, we extend the privacy calculus and give insights on ambiguous decision making in the context of personal data disclosure. Practical and theoretical implications are discussed.