Time-varying effects of cyberattacks on firm value
Michael McShane () and
Trung Nguyen ()
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Michael McShane: Strome College of Business, Old Dominion University
Trung Nguyen: East Carolina University
The Geneva Papers on Risk and Insurance - Issues and Practice, 2020, vol. 45, issue 4, No 3, 580-615
Abstract This paper adds to research on the effect of cyber events on the attacked firm’s value in light of conflicting results from previous studies. Using 536 cyberattack announcements that occurred during the 2007–2016 period, the main goal is to investigate for changes in investor reaction over time as cyberattacks have become more frequent. Empirical evidence shows that cumulative abnormal returns of attacked firms were volatile earlier in the period, became increasingly negative, but have moderated recently. This paper proposes and discusses potential explanations for this observed U-shaped pattern over the 10-year period. The relation between stock market reaction and type of attack, type of data affected, type of perpetrator and various firm level characteristics is also examined.
Keywords: Cyberattacks; Cyber event study (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:pal:gpprii:v:45:y:2020:i:4:d:10.1057_s41288-020-00170-x
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