Do data breach disclosure laws reduce identity theft?

In the United States, identity theft resulted in corporate and consumer losses of $56 billion dollars in 2005, with up to 35 percent of known identity thefts caused by corporate data breaches. Many states have responded by adopting data breach disclosure laws that require firms to notify consumers i...

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Bibliographic Details
Published in:Journal of policy analysis and management 2011-03, Vol.30 (2), p.256-286
Main Authors: Romanosky, Sasha, Telang, Rahul, Acquisti, Alessandro
Format: Article
Language:English
Subjects:
Access to Information
Business information
Computer Security
Consumer Economics
Consumers
Criminal law
Data breaches
Data integrity
Data management
Data protection
Data security
Deception
Disclosure
Disclosure of information (securities law)
Empirical research
Identification (Psychology)
Identity
Identity theft
Information legislation
Law
Law firms
Legislation
Panel data
Personal information
Policy analysis
Program Effectiveness
Property crimes
Public policy
State laws
State Legislation
Studies
Theft
U.S.A
United States
United States Federal trade commission
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Summary:In the United States, identity theft resulted in corporate and consumer losses of $56 billion dollars in 2005, with up to 35 percent of known identity thefts caused by corporate data breaches. Many states have responded by adopting data breach disclosure laws that require firms to notify consumers if their personal information has been lost or stolen. Although the laws are expected to reduce identity theft, their effect has yet to be empirically measured. We use panel data from the U.S. Federal Trade Commission to estimate the impact of data breach disclosure laws on identity theft from 2002 to 2009. We find that adoption of data breach disclosure laws reduce identity theft caused by data breaches, on average, by 6.1 percent.
ISSN:0276-8739
1520-6688
DOI:10.1002/pam.20567