07/21/2024
After reviewing a sample letter of a data breach, it can be easily observed that different economic and social science theories relate to data breaches and interacting with those who are affected by the breach. There can be many that correlate with the letter, providing some examples, the Moral Hazard, Supply and Demand, Agency, and Structural Functionalism theories all work hand-in-hand with this letter.
Moral Hazard/Supply and Demand theories are based as economic theories and the Agency/Structural Functionalism theories are based within social sciences. Moral Hazard and Agency both work relate to the letter similarly as they both detail a two-party system to which each party is held accountable to the expectations they have. When a data breach occurs, the agency notifies the client of the breach and outlines the details regarding what happened. With the sample breach noted in the letter, each party can determine what had happened and if the breach is handled appropriately for recovery. This can go even further as the main organization, Glass Washer Parts, had an agreement with a third party for the security that was in place as well. When the expectations are not met between the two parties, this could cause issues with relationships and loss of revenue.
The other two theories, Supply/Demand and Structural Functionalism, also relate together as societal norms may cause a demand to drop when issues, such as data breaches occur. Structural Functionalism outlines how main organizations should be representative of their customers and do their tasks without issues. If this were to happen, adverse effects would be noted and society may lose trust or confidence in the business that was protecting their data. As societal norms change, the demand would begin to fade, thus causing more revenue loss for the organization that experiences the data breach.
Many social science and economics theories mesh with each other when it comes down to data breaches and it is made evident when seen in this sample letter provided. More theories can be observed and described and are used every day during the routine workings of cybersecurity.
References
Umphelet, M. (2024). “SAMPLE DATA BREACH NOTIFICATION”.
Indeed. (2022b, June 24). 11 types of economic theories aspiring economists should know | indeed.com. Indeed.Com. https://www.indeed.com/career-advice/career-development/economic-theory-types
Staines, Z., Hoffstaedter, G., & Binnie, N. (2023, May 19). Social science theories, methods, and values. Introduction to the Social Sciences. https://uq.pressbooks.pub/introduction-social-sciences/chapter/social-science-theories-and-methods/
Libretexts. (2021, August 22). 4.5: Examples of social science theories. Social Sci LibreTexts. https://socialsci.libretexts.org/Bookshelves/Social_Work_and_Human_Services/Social_Science_Research_-Principles_Methods_and_Practices(Bhattacherjee)/04%3A_Theories_in_Scientific_Research/4.05%3A_Examples_of_Social_Science_Theories