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Simple Economics of Cybercrime and the Vicious Circle

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The Global Cybercrime Industry

Abstract

Cybercrimes are becoming increasingly pervasive and sophisticated and have more severe economic impacts than most conventional crimes. Technology and skill-intensiveness; a higher degree of globalization than conventional crimes; and the newness make cybercrimes structurally different. In this chapter, we examine how characteristics of cyber-criminals, cybercrime-victims, and law-enforcement agencies have reinforced each other and formed the vicious circle. Next, we build on key elements of the vicious circle and some additional characteristics of cybercrimes to assess the cost–benefit calculus of a hacker.

“Today’s online data thieves don’t just run automatic scanners and jump on any network hole they find. They’re more likely to first choose a target that has data they can turn into cash, and then figure out how to break in” (Peter Tippett of Verizon Business, cf. Larkin, 2009, p. 33).

“Law enforcement is presently 5 to 10 years behind the global crime curve in relation to technological capabilities” (Alexander, 2002).

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  1. Bryan School of Business and Economics, The University of North Carolina at Greensboro, Greensboro, NC, 27402-6165, USA

    Dr. Nir Kshetri

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Kshetri, N. (2010). Simple Economics of Cybercrime and the Vicious Circle. In: The Global Cybercrime Industry. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-11522-6_2

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