The Economics of Computer Hacking

Note: The article is present in duplicate on authors medium.com account as well.

This is my review, summary and analysis of this well-written paper “The economics of computer hacking” [1].

There are various kinds of hackers. Some are driven only by fame others are driven by profit alone, and some by profession. The authors here study and discuss how the markets work for all kinds of hackers.

Some History

Originally hackers used to improve systems and had nothing to do with stealing.

It dates back to 1960, as per the authors [1] when a lab at MIT hacked a railway control system to improve the performance of the train.

In 1969 — AT&T Bell Lab created Unix, an open-source operating system. Hackers with time wanted to exploit paid systems. While Unix was a free operating system. Hackers believe all information should be freely available and hence support this development.

In 1970s — hackers started to find the potential of fame or money behind hacking. This started the problem.

In 1984 — illegally accessing computer systems became illegal in USA.

In 1988 — the internet worm spread on computers.

In 1998 — the U.S. made more laws for security breaches.

May 2000- “I love you” virus spreads around and costs billions of dollars.

July 2000- Biggest hacker convention. Tips on hacking shared.

Kinds of hackers

The kinds of hackers are:

1. Good hackers
2. Fame-driven hackers
3. Greedy hackers

What motivates hackers to hack?

Good Hackers

• These hackers break into other systems but also share with them the security vulnerabilities with them after this.
• Most of these hackers are harmless.
• Many of them share security loopholes with companies.
• Many security vulnerabilities are corrected with the help of good hackers.
• Still, it is not morally right to enter a computer system of a company without permission, access the weak points, and then inform. No this is not right.
• Many work in computer security firms.

Fame-driven Hackers

• These are unethical hackers. They break into the systems and expose the weak points, often steel pieces of information as well.
• Work for peer recognition and personal profits.
• Many work for fame and reputation among the hacking communities.
• New hacks on systems increase their reputations in underground communities. The hacker may spread this information by word of mouth or they can they can publish this information in bulletin boards or magazines related to hacking.
• The hackers declare their responsibility for the new hack.
• The hackers also produce the data hacked and how the system was hacked.
• The underworld of hacking has its own word-of-mouth chains, its own magazines, and websites.
• They enter elite hackers gangs and also became well-known to outside world as well.
• They see the quality of hacking and reject monetary awards.
• Government legal laws came up and legislation was set for defaulters.

Greedy hackers

These hackers do not run after fame but work for money and payments.

• They hack for profits.
• Do it to earn money.
• They can be hired for anti-hacking.

Legislative Policies and Conclusions

• Legislative measures are being put in place so that bad and good hackers are stopped from unnecessarily intruding into the systems of companies and governments and manipulating or stealing the data.
• The bad hackers are stopped at the grassroots level, by ending and making it illegal to hack systems.
• Their supply chains are monitored.
• Legal punishments are made when the hackers are tracked.
• Options are provided after punishment time for conversion from a bad hacker to a good-for-profit or profit-based hacker. However, employers can’t fully trust these bad hackers for sure. Hence, they are mindful of what work to give to bad workers who have passed their punishment terms.
• Raising the income also can help the end of bad hackers.
• Need of end of applause for bad hackers.
• Need of end of their underworld websites.
• Need of end of their underworld magazines.

References

[1] Leeson, P. T., & Coyne, C. J. (2005). The economics of computer hacking. JL Econ. & Pol’y, 1, 511.