Executive Pay: The Curious Case of Carlos Ghosn’s Arrest
February 12, 2025
Personal income taxes are omnipresent all over the world. From the developed nations to the developing ones, all tax the incomes of their citizens at different rates. There are only ten countries across the entire world where there are no income taxes. Out of these ten countries, six are from the Gulf peninsula. The governments […]
Managing Warehouse Operations is akin to playing a symphony with people, systems, and processes. As long as these elements are balanced and in harmony the operations go on smoothly and efficiently. People People are very important assets of warehouse operations. Human resources can be the strongest and the weakest link to warehouse performance. Even in […]
In previous modules, we have alluded to the global economic crisis and the impact it had on the various sectors in the financial and manufacturing industries. This article introduces readers to the global economic crisis and subsequent articles deal with the various dimensions to the crisis and the causal factors that were responsible for the […]
IN addition to functions covered by technical modules such as user’s management, License management, installation (as discussed in earlier papers), ERP technical module provides several other important functionalities. Some of these functionalities, as given below, will be very briefly discussed in this paper: Audit management Device management Text management Job management Audit management: Large organizations […]
The global economic crisis that started in 2008 has engulfed the entire world and has laid waste to the process of globalization that was blamed by many as being the root cause of the crisis. After the American Investment Bank, Lehmann Brothers filed for Bankruptcy in September 2008, the entire global financial system was at […]
Facebook is one of the most important firms in the American economy. The tech giant is a major employer in the United States. Its actions have a profound economic impact across the globe. This is the reason behind the hefty valuation that Facebook commands. However, this valuation and the entire business model came under siege on March 19, 2018. Facebook was found to be engaged in a political scandal. As a result, the valuation of Facebook suddenly crashed. The company lost more than $36 billion in market capitalization in a single day. This negative sentiment also impacted the Dow Jones Industrial Average which was down by close to 7% in a single day.
In this article, we will have a closer look at the political scandal that Facebook has been involved in. We will also consider some of the economic impacts of this scandal.
Cambridge Analytica is a public relations firm based in the United Kingdom. This firm specializes in psychological profiling and even psychological warfare. This means that they collect data from social networking websites. This data is then used by Cambridge Analytica to draw psychological profiles of the respondents. Once these profiles are drawn the reaction of this audience to various messages are tested. Based on this testing, Cambridge Analytica enables political candidates to form a message which resonates with the population. The underlying belief behind these activities is that people do not vote based on rational thought. Instead, they vote based on emotions. If a company is somehow able to harvest data and understand the emotions, they reach a position wherein they can influence the outcome of the elections.
Facebook was involved in this scandal because the data collected by Cambridge Analytica, in this case, was collected on Facebook. Also, Facebook allowed them to harvest the data from the friends' list of the users who had agreed to take the quiz. This means that people who had not even directly given permission for their data to be used were also affected by the scandal. It is said that Cambridge Analytica used Facebook on a massive scale. They harvested as many as 50 million profiles from Facebook during the period. These profiles were used by the Trump campaign during their election campaign. Also, the involvement of former White House staff and white supremacist Steve Bannon with Cambridge Analytica is making Facebook’s role look even more suspicious.
This scandal is more related to Facebook than to Cambridge Analytica. The reason behind this is that Facebook had full knowledge of the fact that the third party i.e. Cambridge Analytica was developing a tool specifically to harvest the user’s information. It is also known that Facebook had full knowledge of the fact that the data of many users will be taken without their direct consent. However, they still allowed the political consulting firm to harvest data. This is being seen by many as a violation of the privacy policy.
To sum it up, Facebook is in the midst of a major crisis. The reputation of the firm has taken a major beating. Earlier, Facebook was involved in the net neutrality scandal. Now, Facebook is involved in the misuse of customer data. Any more scandals will have a negative impact on the already fragile financial statements of Facebook.
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