Exposure to Cyber Risk and Inadequate Cybersecurity Regulations: Evidence from Municipalities

Filippo Curti, Ivan T. Ivanov, Marco Macchiavelli and Tom Zimmermann

Chicago Fed Letter, 2024, vol. 501

Abstract: In this article, which is based on a related working paper, we document the adverse effects of cyberattacks on municipalities and the ineffectiveness of current state regulation to stave off future cyberattacks. In the process of providing services to their citizens, state and local governments collect and store a wide range of sensitive personal information (data). Access to personal information, sometimes combined with a lack of adequate cybersecurity (FitchRatings, 2022), makes governments attractive targets for cyberattacks, in particular data breaches. Indeed, in our sample external data breaches represent the most common source of cyber risk for governments; therefore, we focus primarily on them.

Keywords: Public economics; financial economics (search for similar items in EconPapers)
JEL-codes: G38 H72 H74 (search for similar items in EconPapers)
Date: 2024
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