The drivers of cyber risk

Leonardo Gambacorta, Iñaki Aldasoro, Paolo Giudici and Thomas Leach

No 14805, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Cyber incidents are becoming more sophisticated and their costs difficult to quantify. Using a unique database of more than 100,000 cyber events across sectors, we document the characteristics of cyber incidents. Cyber costs are higher for larger firms and for incidents that impact several organisations simultaneously. The financial sector is exposed to a larger number of cyber attacks but suffers lower costs, on average, thanks to proportionately greater investment in information technology (IT) security. The use of cloud services is associated with lower costs, especially when cyber incidents are relatively small. As cloud providers become systemically important, cloud dependence is likely to increase tail risks. Crypto-related activities, which are largely unregulated, are particularly vulnerable to cyber attacks.

Keywords: Cyber risk; Cloud services; Financial institutions; Bitcoin; Cryptocurrencies; Cyber cost; Cyber regulation (search for similar items in EconPapers)
JEL-codes: D5 D62 D82 G2 H41 (search for similar items in EconPapers)
Date: 2020-05
New Economics Papers: this item is included in nep-ban, nep-ict and nep-pay
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

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Related works:
Journal Article: The drivers of cyber risk (2022)
Working Paper: The drivers of cyber risk (2020)
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