The cybersecurity entrepreneur

Abstract

AbstractCybersecurity is a major U.S. policy issue with a sizable coalition asserting that self-regulation is failing, primarily due to rampant low quality security products and a dearth of threat information sharing. State intervention proponents, however, generally disregard the role of cybersecurity entrepreneurial activity in fixing disequilibria. My research identifies how entrepreneurs adeptly satisfy consumers’ cybersecurity preferences by developing strong self-regulating mechanisms where data valuations are relatively high. I then empirically examine how entrepreneurial innovations have ameliorated discoordination and significantly improved market outcomes over time through the application of the market process and price theory.