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The economics of cyber risk

From Aniket Baksy and Daniele Caratelli, here is part of the abstract: Because larger firms are more attractive targets but also invest more in protection, the model generates an inverse-U…

  • Larger firms face higher cyberattack risk but invest more in protection
  • Cyber risk measures could reduce firm entry, productivity, and output
  • Subsidies and standards may boost aggregate output, bailouts may lower it

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