On equilibrium cyber risk

Carlos A. Ramírez

Economics Letters, 2025, vol. 251, issue C

Abstract: I develop a simple model to study how the interplay between institutions’ and hackers’ incentives can alter cyber risk within an equilibrium context. By formalizing the strategic interaction between institutions and hackers, the model characterizes how changes in heterogeneity across institutions, cybersecurity technologies, and hacker competition can lead to material shifts in cyber risk.

Keywords: Equilibrium cyber risk; Cybersecurity; Cyberattacks; Hacks (search for similar items in EconPapers)
JEL-codes: D22 D39 M15 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:251:y:2025:i:c:s0165176525001442

DOI: 10.1016/j.econlet.2025.112307

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