Abstract
Firms spend operating costs to mitigate the risk of data breach events. However, firms may not know how much to spend to prevent data breach events with varying incidence frequencies. I present a model that estimates the relationship of breach prevention spending to breach incidence rates for individual firms. After constructing a likelihood function, I use simulated results to show parameter estimates for a range of spending and breach frequencies. Probabilities for counterfactual scenarios are available as well. This model can accommodate variation in firm size, security spending, incidence frequency, and breach types. Estimates can show whether a firm’s breach prevention efforts fall within a range of industry averages.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.