Mekhi Booker

Old Dominion University

CYSE201S

April 3rd, 2024

The letter regarding the data breach incident on www.glasswasherparts.com can be analyzed through the lenses of various economic theories and social sciences theories. One pertinent economic theory is information asymmetry, which points to disparities in information between parties in a transaction leading to market inefficiencies. The delay in the company’s discovery and disclosure of the breach shows the asymmetry between the platform provider and the customers, potentially undermining trust in the marketplace. I believe the concept of cost-benefit analysis applies as affected customers must weigh the costs and benefits of taking actions like contacting their card companies for replacements against potential risks like identity theft. From a social sciences perspective, theories on trust and social capital are relevant. Trust is crucial for functional markets and societal interactions, and breaches like these can erode trust, impacting social capital and cooperation within society. The theories on risk perception and communication highlight how the company’s communication about the breach can influence customers’ perceptions of risk and trust. Effective communication strategies are essential to mitigate negative perceptions and maintain trust among customers. These theories provide frameworks for understanding the broader implications of the data breach incident on economic transactions, social relations, and individual perceptions.