Cyberattacks and Supply Chain Disruptions

Matteo Crosignani, Marco Macchiavelli and André Silva

No 20210622, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: Cybercrime is one of the most pressing concerns for firms. Hackers perpetrate frequent but isolated ransomware attacks mostly for financial gains, while state-actors use more sophisticated techniques to obtain strategic information such as intellectual property and, in more extreme cases, to disrupt the operations of critical organizations. Thus, they can damage firms’ productive capacity, thereby potentially affecting their customers and suppliers. In this post, which is based on a related Staff Report, we study a particularly severe cyberattack that inadvertently spread beyond its original target and disrupted the operations of several firms around the world. More recent examples of disruptive cyberattacks include the ransomware attacks on Colonial Pipeline, the largest pipeline system for refined oil products in the United States, and JBS, a global beef processing company. In both cases, operations halted for several days, causing protracted supply chain bottlenecks.

Keywords: cyberattacks; supply chains (search for similar items in EconPapers)
JEL-codes: G3 (search for similar items in EconPapers)
Date: 2021-06-22
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