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Thursday, December 30, 2010

Information Security

Abstract:

According to one common view, information security comes down to technical measures. Given better access control policy models, formal proofs of crypto-graphic protocols, approved firewalls, better ways of detecting intrusions and malicious code, and better tools for system evaluation and assurance, the problems can be solved. In this note, we put forward a contrary view: information insecurity is at least as much due to perverse incentives. Many of the problems can be explained more clearly and convincingly using the language of microeconomics: network externalities, asymmetric information, moral hazard, adverse selection, liability dumping and the tragedy of the commons

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