Digital Adoption and Cyber Security: An Analysis of Canadian Businesses

Joann Jasiak, Peter MacKenzie and Purevdorj Tuvaandorj

Papers from arXiv.org

Abstract: This paper examines how Canadian firms balance the benefits of technology adoption against the rising risk of cyber security breaches. We merge data from the 2021 Canadian Survey of Digital Technology and Internet Use and the 2021 Canadian Survey of Cyber Security and Cybercrime to investigate the trade-off firms face when adopting digital technologies to enhance productivity and efficiency, balanced against the potential increase in cyber security risk. The analysis explores the extent of digital technology adoption, differences across industries, the subsequent impacts on efficiency, and associated cyber security vulnerabilities. We build aggregate variables, such as the Business Digital Usage Score and a cyber security incidence variable to quantify each firm's digital engagement and cyber security risk. A survey-weight-adjusted Lasso estimator is employed, and a debiasing method for high-dimensional logit models is introduced to identify the drivers of technological efficiency and cyber risk. The analysis reveals a digital divide linked to firm size, industry, and workforce composition. While rapid expansion of tools such as cloud services or artificial intelligence can raise efficiency, it simultaneously heightens exposure to cyber threats, particularly among larger enterprises.

Date: 2025-04
New Economics Papers: this item is included in nep-ict and nep-pay
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2504.12413 Latest version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2504.12413

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().