 Optimal solution to cybercrimes: lessons from law and economicsRuperto P. Majuca
Philippine Review of Economics, 2014, vol. 51, issue 1, 84-116 Abstract: A model is presented wherein cybercrimes are addressedÊthrough a combination of private and public measures. ThisÊcaptures the substitutability of private and public responses andÊdetermines the optimal combination of these approaches. TheÊsocially optimal level of security is achieved by equalizing theÊmarginal-benefit-to-marginal-cost ratios of each of the threeÊalternatives: private security investment, nonrivalrous securityÊinvestment, and law enforcement measures. The interrelatednessÊof Internet risks causes individual firms to underinvest in privateÊand public security goods. The government thus lowers theÊlevel of police enforcement expenditures to induce firms toÊinvest more in individual precautions. In certain conditions,Êcooperation results in socially optimal levels of expenditures inÊprivate and public security goods. The Shapley [1953] value canÊbe used as a criterion for allocating the costs and benefits amongÊthe members of a security cooperative Keywords: law and economics; cybersecurity; interrelated risks; public goods; law enforcement (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:phs:prejrn:v:51:y:2014:i:1:p:84-116 Access Statistics for this article More articles in Philippine Review of Economics from University of the Philippines School of Economics and Philippine Economic Society Contact information at EDIRC. |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.