Making Deals With Shadows: The Economics of Ransomware and Cybersecurity

The Answer Is Transaction Costs

The digital realm is rife with invisible threats, and this episode doesn't shy away from the gritty realities of ransomware and the burgeoning industry of cyber insurance. We tackle the conundrum: How do these defensive expenditures impact our economy when they don't actually produce anything tangible? From the early days of cyber insurance to the ongoing battle against hackers, learn how organizations across the board—from the halls of government to the frontlines of business—are fortifying their defenses against a barrage of cyber threats, each with their own unique strategies and vulnerabilities.
Wrapping up with a human touch, our conversation turns to the pivotal role individuals play in the security of networks and the negotiation tactics employed once defenses have been breached. And because all work and no play makes for a dull podcast, we round off the session with a sprinkling of economic humor, answering listener queries with a blend of wit and wisdom. Don't forget, for those hungry for more knowledge, I've got some book recommendations to deepen your understanding of the legendary thinker Adam Smith.
Links:
Anja Shortland Website: https://www.kcl.ac.uk/people/anja-shortland-1
Duke CHOPE Hayek Lecture with Dr. Shortland: https://www.youtube.com/watch?v=Czs2EYDo2sI
Books:
Arthur Herman: How the Scots Invented the Modern World https://www.amazon.com/How-Scots-Invented-Modern-World/dp/0609809997
James Otteson: Adam Smith's Marketplace of Life https://www.amazon.com/Adam-Smiths-Marketplace-James-Otteson/dp/0521016568/ref=monarch_sidesheet
Adam Smith: The Theory of Moral Sentiments https://www.libertyfund.org/books/the-theory-of-moral-sentiments/
EconTalk Book Club (six episodes): https://www.econtalk.org/klein-on-the-theory-of-moral-sentiments-episode-1-an-overview/

If you have questions or comments, or want to suggest a future topic, email the show at [e-mail] !

You can follow Mike Munger on Twitter at @mungowitz

Chapters

1. Ransomware, Insurance, and Transaction Costs (00:00:00)

2. Ransomware, Cyber Insurance, and Hackers (00:11:38)

3. Ransomware, Cybersecurity, and Negotiation Strategy (00:28:20)

4. Economics Jokes, Smart Grids, and Books (00:39:09)