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Identity Theft

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  • Keith B. Anderson
  • Erik Durbin
  • Michael A. Salinger

Abstract

Identity theft is made possible by the nature of modern payment systems. In the modern economy, sellers are willing to offer goods and services to strangers in exchange for a promise to pay, provided the promise is backed up by data that link the buyer to a specific account or credit history. Identity theft involves acquiring enough data about another person to counterfeit this link, enabling the thief to acquire goods while attributing the charge to another person's account. In this article, we discuss what is (and is not) known about the prevalence and cost of identity theft, describe the institutional framework in which identity theft takes place, and consider some of the main policy issues associated with the problem.

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/jep.22.2.171
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Bibliographic Info

Article provided by American Economic Association in its journal Journal of Economic Perspectives.

Volume (Year): 22 (2008)
Issue (Month): 2 (Spring)
Pages: 171-192

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Handle: RePEc:aea:jecper:v:22:y:2008:i:2:p:171-192

Note: DOI: 10.1257/jep.22.2.171
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  1. Jack Hirshleifer, 1983. "From weakest-link to best-shot: The voluntary provision of public goods," Public Choice, Springer, Springer, vol. 41(3), pages 371-386, January.
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Cited by:
  1. Roberds, William & Schreft, Stacey L., 2009. "Data breaches and identity theft," Journal of Monetary Economics, Elsevier, Elsevier, vol. 56(7), pages 918-929, October.
  2. Caterina Giannetti & Nicola Jentzsch, 2011. "Credit Reporting, Access to Finance and Identification Systems: International Evidence," Jena Economic Research Papers 2011-031, Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics.
  3. Giannetti, Caterina & Jentzsch, Nicola, 2013. "Credit reporting, financial intermediation and identification systems: International evidence," Journal of International Money and Finance, Elsevier, Elsevier, vol. 33(C), pages 60-80.
  4. William Roberds & Stacey L. Schreft, 2009. "Data security, privacy, and identity theft: The economics behind the policy debates," Economic Perspectives, Federal Reserve Bank of Chicago, Federal Reserve Bank of Chicago, issue Q I, pages 22-30.

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