Estimating the Value of Computer Files Using Willingness to Pay and Willingness to Accept

Abstract

Cyber attacks are a growing threat that undoubtedly cause significant loss to individuals. We know, however, surprisingly little about the true economic cost of such attacks. In this paper we estimate the value individuals put on their computer files by eliciting willingness to pay (WTP) and willingness to accept (WTA) from a representative sample of the UK population. We find that the distribution of valuations is highly skewed to the right, with a median WTP of only £50 and a median WTA of £700. Interestingly, we find systematic differences in WTP and WTA depending on the cyber awareness of the individual and their attitudes to data breach.

Keywords: Ransomware, Cyber-security, cyber-crime, willingness to pay, willingness to accept

JEL Classification: D10, K42