26 Pages Posted: 11 Dec 2007
Date Written: 2005-11-21
We study a strategic model in which a defender must allocate defensive resources to a collection of locations and an attacker must choose a location to attack. In equilibrium, the defender sometimes optimally leaves a location undefended and sometimes prefers a higher vulnerability at a particular location even if a lower risk could be achieved at zero cost. The defender prefers to allocate resources in a centralized (rather than decentralized) manner, the optimal allocation of resources can be non-monotonic in the value of the attacker's outside option, and the defender prefers her defensive allocation to be public rather than secret.
Suggested Citation: Suggested Citation
Bier, Vicki M. and Oliveros, Santiago and Samuelson, Larry, Choosing What to Protect: Strategic Defensive Allocation Against an Unknown Attacker (2005-11-21). Journal of Public Economic Theory, Vol. 9, Issue 4, pp. 563-587, August 2007. Available at SSRN: https://ssrn.com/abstract=1066072 or http://dx.doi.org/10.1111/j.1467-9779.2007.00320.x
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