Cash Substitution and Deferred Consumption as Data-Breach Harms
Lisa Yao Liu & Lior Strahilevitz
What the paper says
Federal courts are divided over whether consumers whose data are obtained in a breach suffer an injury in fact that gives them standing to sue under Article III of the US Constitution. Judicial opinions find no constitutional standing in a narrow majority of such cases, and plaintiffs are likely to lose absent causal links to subsequent identity theft or the disclosure of embarrassing information. Our paper identifies a novel injury that results from data breaches. Upon learning about local data breaches, consumers immediately and temporarily reduce their purchases and shift from credit card purchases to cash transactions. After a data breach, many consumers forgo the benefits of a short-term loan from their credit card issuer, cash-back benefits, and other perks associated with card purchases. In light of our empirical results, the standing barrier that has thwarted so many data-breach suits in federal court may be easily surmounted.
1 citation
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.16 × 0.4 = 0.06 |
| M · momentum | 0.50 × 0.15 = 0.07 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.