Cybersecurity • Background • Some Research Background - Cybersecurity • Much of the work in the field has been undertaken by computer scientists/engineers and legal scholars • Nascent literature at the “intersection” of computer science/engineering and economics on cyber security. • Why Economists? • Ross Anderson: “As systems scale globally, incentives start to matter as much as technology. Systems break when the people who could fix them are not the people who suffer thecosts of failure. So it's not enough for security engineers tounderstand crypto, mathematics and the theory of operating systems; we have to understand game theory and microeconomics too. This has led to a rapidly growing interest in ‘security economics’ “ Viruses: huge potential damages • The Slammer, Blaster, and Sobig.F virusesexploited vulnerabilities even though security updates had been released. • According to the Economist, the vulnerabilities exploited by these viruseswere reverse engineered by hackers. • Time between the disclosure of a vulnerability and an attack exploiting thevulnerability has declined significantly. • Zero-day vulnerabilities Economics & Public Policy of Cybersecurity • Why has Internet security worsened even as investmenthas increased? • According to a report from the US Secret Service, nearly2/3 of all data breaches could have been prevented using "simple and cheap" countermeasures. Why aren't they deployed? • How much should firms ...
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