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Internet Security, Vulnerability Disclosure and Software Provision

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Author Info
Choi, Jay-Pil
Fershtman, Chaim
Gandal, Neil

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Abstract

In this paper, we examine how software vulnerabilities affect firms that license software and consumers that purchase software. In particular, we model three decisions of the firm: (i) an upfront investment in the quality of the software to reduce potential vulnerabilities; (ii) a policy decision whether to announce vulnerabilities; and (iii) a price for the software. We also model two decisions of the consumer: (i) whether to purchase the software; and (ii) whether to apply a patch.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5269.

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Date of creation: Oct 2005
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Handle: RePEc:cpr:ceprdp:5269

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Related research
Keywords: internet security network effects software vulnerabilities

Find related papers by JEL classification:
L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
O3 - Economic Development, Technological Change, and Growth - - Technological Change

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This page was last updated on 2008-8-19.

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